EV Battery Regulations around the World: What You Need to Know

Anastasia Popova is a Content Marketing Manager at Minespider
Anastasia Popova
Governments have realised the need to control resources required for future clean energy production. As EVs and batteries play a vital role in meeting the clean energy goals, rapidly evolving regulatory frameworks are setting obligations for all battery industry participants. This article summarises some of the key laws focused on lithium batteries components in the US, Europe, China, Japan and South Korea.
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Lithium-ion batteries became a hot topic because they are crucial for the clean energy transition and future green and circular economy. Demand for batteries is set to increase 14-fold by 2030. This is mostly driven by electric transport - making this market strategic at a global level. Meeting the demand is challenging as certain countries control the largest deposits of resources and related mineral supply chains.

In recent years the global supply chain showed fragility, so countries started tightening the screws and introducing laws to control minerals. Global mining companies, car manufacturers, battery producers, and other EV supply chain participants have to navigate through the changing regulatory frameworks, and more and more regulations come into force around the globe. In this article, we collected regulations focused on batteries from the regions forecasting the highest volumes of EV production.

The EU

The European Union was one of the first to set common rules for critical materials and later in the battery segment. To achieve carbon neutrality by 2050, among other steps under the EU Green Deal’s top priorities, the EU Commission has introduced the new Circular Economy Action Plan that aims to ensure that used resources are kept in the EU economy. The Circular Economy Action Plan focuses on the most resource-consuming sectors where the potential for circularity is high, with batteries and EV production being among those.

Under the plan, the Commission proposed a new regulatory framework for batteries. It will expand the Battery Directive (we have already covered the initial Proposal) and bring new amendments to the battery regulation in the EU countries, in particular:

  • Set the common rules for the battery segment across the EU,
  • Propose rules on recycled content to ensure the recovery of materials,
  • Set the requirements for sustainability and transparency of battery production and recycling, including the carbon footprint of battery manufacturing, ethical sourcing of raw materials and security of supply, and facilitating reuse, repurposing, and recycling.

Few realize that there was an update to the Battery regulation draft in March this year. The document proposes stronger requirements on sustainability, performance and labelling of batteries and suggests rules on a carbon footprint declaration and label.

The new draft also defines a new category, “batteries for ‘light means of transport’ (LMT) such as electric scooters and bikes, and sets rules for it. Beyond that, the dates when specific requirements for the battery supply chain participants come into force have been changed.

Article 49 of the latest version of the Proposal obliges producers of the industrial batteries and electric vehicle batteries to take responsibility for battery waste collection - regardless of the chemistry, brand and condition - free of charge and without any obligation to buy a new battery. Battery materials should be recycled to meet the minimum efficiency KPIs, which are not yet determined.

The United States

The Inflation Reduction Act was introduced in August 2022 to help the US achieve its climate goals under the Paris Agreement. The IRA is based on another important legislation, the Build Back Better Act (BBBA) which was a $1.7 trillion package with one-third specifically dedicated to clean energy. The BBBA didn’t progress in the Senate, however it was quickly followed by climate actions presented in the Inflation Reduction Act. The IRA is forging historic investments in a diverse range of climate solutions, including batteries for EVs and industrial applications.

While there are 4 critical minerals - lithium, nickel, cobalt, and natural graphite - defined for the battery segment in the EU under the Annex X of the recent Draft Compromise text, section 45X(c) of the Inflation Reduction Act names 50 “applicable critical minerals'' for the energy transition.

Among those critical minerals are:

Aluminium, antimony, arsenic, barite, beryllium, bismuth, cerium, cesium, chromium, cobalt, dysprosium, erbium, europium, fluorspar, gadolinium, gallium, germanium, graphite, hafnium, holmium, indium, iridium, lanthanum, lithium, lutetium, magnesium, manganese, neodymium, nickel, niobium, palladium, platinum, praseodymium, rhodium, rubidium, ruthenium, samarium, scandium, tantalum, tellurium, terbium, thulium, tin, titanium, tungsten, vanadium, ytterbium, yttrium, zinc, and zirconium.

Mining companies excavating critical metals in the US will be able to seek production credit equal to 10% of production costs. The extracted minerals must meet defined purity thresholds to qualify for the credit, as laid out in the act.

The Inflation Reduction Act of 2022 (Public Law 117-169) amended the Qualified Plug-in Electric Drive Motor Vehicle Credit (IRC 30D), now known as the Clean Vehicle Credit, and added a new requirement for final assembly in North America that took effect on August 17, 2022.

Certain tax credit qualifications in the Inflation Reduction Act contain domestic sourcing requirements for battery materials, and final vehicle assembly in the US. A tax credit of up to $7500 is available for vehicles meeting certain value, type, and battery material and component requirements.

The act also specifies the minimum thresholds of minerals contained in US-manufactured EV batteries to qualify for the tax credit. At least 40% of critical minerals in US-made EV batteries must come from US miners or recycling plants, or mines in countries with free trade agreements with the US. Today the US has FTAs with 20 countries.

The Act sets minimum percentages for the value of battery components sourced from North America required for a project to receive tax credits. Before 2024, at least 50% of the value of a US-made battery’s components must come from North America. This rises to 60% in 2024 and 2025, 70% in 2026, and then 10% more each year until reaching 100% in 2029.

The act defines the “percentage of the value” of the applicable battery critical minerals extracted or processed in the US or a US free-trade partner or recycled in North America, to be:

·       40% for a vehicle placed in service before 1 January 2024;

·       50% for a vehicle placed in the service during the calendar year 2024;

·       60% for a vehicle placed in service during the calendar year 2025;

·       70% for a vehicle placed in service during the calendar year 2026; and

·       80% for a vehicle placed in service after 31 December 2026.

$3,750 of the $7,500 tax credit is achieved by meeting a requirement that a certain threshold of critical minerals in the EV battery be extracted or processed in the U.S., countries with which the U.S. has a free trade agreement, or have been recycled in North America. The battery minerals also must meet certain purity requirements to qualify.

Mineral Purity Thresholds are:

40% through the end of 2023,

50% in 2024,

60% in 2025,

70% in 2026,

80% after 2026.

US National Blueprint for Lithium Batteries 2021-2030

In March 2022, the United States invoked the Defence Production Act to rapidly boost US production of critical minerals for EV and storage batteries, focussing on lithium, nickel, cobalt, graphite and manganese.


China is one of the economies making significant advances in the battery and EVs sectors.  China also controls some of the most critical mineral supply chains. China has active regulation for recycling, including a regulation on battery recycling first introduced in 2018. The regulation requires manufacturers of new-energy vehicles (NEVs) and others to set up and standardise recycling plants for electric vehicle batteries. These plants will be shared by NEV manufacturers, battery makers, wrecking yards, integrated companies, and more. Dedicated electric car battery recycling facilities collect, sort, store, package, and ship worn-out units, though they are not allowed to disassemble units for any purpose aside from conducting safety inspections. They are also expected to use digital tools to trace and collect data on their inventory and hand the information over to manufacturers, oto in turn report recycling data in a “timely fashion”.

China plans to become one of the top market players in the EV and batteries market. The country introduced several regulations focused on the lithium battery industry to foster industry growth while improving health and safety, and encouraging foreign investment.

Below are some regulations which address the EV and battery segments:

  • 14th Five-Year Plan for the Development of the Raw Materials Industry (2021-2025),
  • Catalogue of Encouraged Foreign Investment Industries (2019 Edition),
  • Lithium-ion Battery Industry Specification Conditions (2018 Version),
  • Interim Measures for the Management of Recycling and Utilisation of New Energy Power Vehicle Battery,
  • Interim Provisions on the Management of Traceability of Recycling and Utilisation of New Energy Vehicles Power Battery,
  • Guidelines for Construction and Operation of New Energy Vehicle Power Battery Recycling Service Outlets.


Since the early 2000s, Japan has been a world leader in the 3Rs (Reduce, Reuse, Recycle) and has achieved steady results in reducing the final disposal of waste and improving the recycling rates.

One of the foundations of Japan's circular economy is the “Basic Law for Establishing the Recycling-based Society'' that came into force in 2000. Like some other Japanese laws, it promotes and encourages environmentally friendly initiatives among public, government and businesses. Later, in 2018, the Ministry of Environment launched the 4th plan of establishing a Circular Society. Three main drivers in the plan include:

  • a regional revitalization through a circulation system,
  • the full circulation of resources’ life cycle,
  • the appropriate processing of waste or regeneration of resources.

The most highly regarded Japanese circular economy initiative is the Top Runner Program. The Program covers products and services that use energy. It employs a combination of economic and command- and-control policies, and its enforcement mechanisms are unconventional, employing, for example, the “name and shame” device. The government selects the “top” product in a given category and sets its energy efficiency characteristics as the baseline requirements for all products in the same category.

Japan Energy Plan

Japan Green Growth Strategy

Top Runner Program

South Korea

South Korea changed regulations to allow for environmentally friendly ways to utilise used batteries from electric vehicles. This change anticipates the effect of  Korea’s Green Energy drive. The number of used EV batteries is anticipated to increase sharply in the future as EVs and hydrogen fuel-cell cars become commonplace.

The latest move paved the way for Hyundai Glovis Co., an auto parts unit of Hyundai Motor Group, to rent batteries to KST Mobility Co., an EV taxi operator, which will help the company better manage and recycle used batteries. Hyundai Motor Co., South Korea's top car producer, will also study ways to harness used EV batteries to build energy storage containers, which are connected to solar facilities. LG Chem Ltd, a major battery producer, will also carry out research projects on finding ways to utilise used batteries in producing ESS (energy storage systems) products.

The renewable energy industry in South Korea is principally regulated by the Electricity Business Act (also known as the Electric Utility Act) and the Renewable Energy Act. The Renewable Energy Act outlines key matters concerning renewable energy projects. In May 2020, the South Korean government unveiled a $60.9 billion ‘Green New Deal’ (also known as the ‘2025 Plan’) as part of its wider national strategy to transform the economy from high carbon to low carbon in light of the Covid-19 pandemic. It includes plans to expand the country’s green mobility fleet to 1.33 million electric and hydrogen powered vehicles and investment in smart grids. The Green New Deal also sets ambitious goals of ending funding of overseas coal plants, transforming urban areas into smart green cities, and introducing  a carbon tax.

South Korea announced investments in the battery market


Governments around the globe realised the need to retain critical resources within their borders. Many new regulations focused on the EV market and lithium-ion batteries are coming into force. EV supply chain participants will be obliged to track and trace batteries and ensure they recycle and reuse critical materials, while at the same time keeping them within the country. Regulations and their requirements differ by region.

To make this transition possible, companies need a unified solution and technology tools. Such tools should enable the exchange of information between all the battery supply chain participants, tracking and tracing minerals and battery components, calculating carbon emissions, and monitoring the recycled content share. A blockchain-based Battery Passport is one of the possible solutions, as it provides a secure and efficient way to track batteries and battery components throughout the whole lifecycle.

Want to prepare your company  for new Battery Regulations? Our expert team is happy to help you start preparing to comply with upcoming regulations, with strategies developed specifically for the region(s) you operate in. Get in touch here.

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About the author
Anastasia Popova is a Content Marketing Manager at Minespider
Anastasia Popova
Anastasia is a Content Marketing Manager at Minespider. She is passionate about B2B marketing, content, PR and emerging technologies. Anastasia has over 10 years of experience working with deep-tech startups and corporations like Honeywell, Eaton, Rockwell Automation, and others.

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