The deal aims to "facilitate trade, promote fair competition and market-oriented conditions for trade in critical minerals, advance robust labour and environmental standards, and cooperate in efforts to ensure secure, transparent, sustainable, and equitable critical minerals supply chains", according to the Office of the US Trade Representative.
Under the deal, both countries are prohibited from enacting bilateral export restrictions on the minerals most critical for EV batteries, including lithium, nickel, cobalt, graphite and manganese.
The agreement will also allow electric vehicles made from metals processed in Japan to qualify for tax credits under President Joe Biden’s Inflation Reduction Act. The Act will allow households to receive up to $7,500 (£6,140) in tax credits to buy an electric car or $4,000 (£3,275) for a used one.
Under the bill, half of the credit for purchasing consumers is reserved for North American-assembled vehicles...