LG Energy Solution And SK Innovation Fights Over Import Ban In The States

US Import Ban

US Import Ban on LG and SK

Two of the world’s largest electric-vehicle battery makers have hired top Washington insiders to hold near-daily meetings with the Biden administration during a battle which can affect the electrification plans of Ford Motor Co and Volkswagen AG.

SK Innovation Co, Ford’s battery supplier for its upcoming electric F-150 pickup , faces a 10-year US import ban on its Korean-made batteries and components after April 11. SK Innovation has engaged such well-connected advocates as former EPA chief Carol Browner and one-time Acting Attorney General Sally Yates to convince the administration to intervene.

LG Energy Solution Co, which won the order against its rival from the US International Trade Commission for what the agency said was an “extraordinary” effort to destroy evidence during a trade secrets battle, has also brought in hired guns to influence the Biden team. Ernest Moniz, an Obama energy secretary, is advising Seoul-based LG Energy on its strategic plans, while other insiders are lobbying the administration.

Joe Biden
Joe Biden Plans Import Ban From April 11

“The development of the battery supply chain goes to depend upon what happens with this case,” Moniz said in an interview.

Meetings are being held with a minimum of a dozen agencies, including officials at Labor, Transportation and Energy. Talks, conducted over the online due to the Covid-19 pandemic, have focused on “climate change, electrification of vehicles, the Ford F-150 and jobs,” said Browner, Bill Clinton’s Environmental Protection Agency chief who also served as a White House climate adviser when Biden was president .

Biden has until April 11 to intervene. Presidential vetoes, known formally as “disapprovals,” of ITC import bans are rare. The last one was in 2013, when the Obama administration overturned a US import ban on some older models of Apple Inc’s iPhones and iPads during a blow to Samsung Electronics Co.

Qualcomm Ban
Qualcomm Ban

The issue could even be a classy one for Biden. The president has made the promotion of EVs a cornerstone of his $2.25 trillion infrastructure plan to bolster the economy and combat global climate change . Both South Korean battery makers are building plants within the US which can employ thousands of yank workers. At an equivalent time, Biden can’t be seen as wavering on property protection considering the long-standing US dispute with China over the matter .

While every ITC import ban undergoes a presidential review, “it’s rarely that there’s a meaningfully contested one,” said LG Energy’s lawyer, David Callahan of Latham & Watkins LLP in Chicago, who’s been coordinating meetings between agency officials and LG Energy’s senior executives.

SK Innovation rose 1.8% to 232,500 Korean won ($208.29) in Seoul trading, while LG Chem Ltd., the parent of LG Energy, was little changed at 811,000 won.

LG and SK Innovation on the verge of Ban
LG and SK Innovation on the verge of Ban

LG Energy filed its claim against SK Innovation in April 2019 for allegedly stealing trade secrets by poaching many highly knowledgeable employees. Since then both companies have spared no expense to use the services of Washington influencers. In 2020, SK Innovation spent $650,000 on its lobbying efforts and LG spent $531,666, according to data collected by the center for Responsive Politics.

Lobbyists for LG Energy, SK Innovation, Ford and Volkswagen are meeting with quite a dozen agencies including Commerce, Justice and Defense departments; the EPA; the National Economic Council, and thus the National Security Council . US Trade Representative Katherine Tai, who’s designated to form the choice , has the task of assessing the knowledge and deciding which arguments hold clout.

To lead its effort, SK Innovation has hired former ITC Chairman Shara Aranoff and Dan Spiegel, a former ambassador to the United Nations in Geneva, who are both now with firm Covington & Burling LLP. SK Innovation has also engaged Chartwell Strategy Group, a Washington advisory firm co-founded by former congressional aide Ozzie Palomo, to lobby stakeholders.

“The material is true at the middle of what they’ve been performing ,” Spiegel said of the new administration.

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