New Bill Proposes Battery Supply Chain Tracing

May 3, 2024
By: Hannah B. Kreinik

Congress is again focused on forced labor reform with a newly proposed bill that promotes supply chain tracing in the battery industry. This new bill nicknamed the “TRACE Act,” comes after multiple efforts to enforce due diligence in supply chains from forced labor, worker’s rights, and environmental rights perspectives. Customs has been zeroing-in on forced labor enforcement against the battery sector (please see our prior article on the issue here) for the past few months.

The bipartisan bill was presented to the House and is undergoing review by the Committee on Energy and Commerce and the Committee on Science, Space, and Technology. The bill would charge the Department of Energy with supervising voluntary digital tracing program for batteries that provides information on the battery’s materials origin, maintenance, repair and function data, recycling, and potential human, labor, and environmental issues in its supply chain. In the interest of domestic production and protection of human rights, the US has been pursuing different solutions to the Chinese monopoly over electric vehicle battery and raw battery material industries (please see our latest article on the topic here). It has been reported that 26 of the 43 minerals relied on by the US are either completely produced or partially produced by China. These critical minerals include graphite, lithium, and cobalt, all of which have had their own run-ins with forced labor concerns. With this new bill, the US continues trying to commit to forced labor change and sustainability through supply chains.

This bill makes clear that importers should be aiming for full transparency in their supply chains, especially when it comes to forced labor and environmental rights. Barnes, Richardson & Colburn attorneys are here to assist you in ensuring that your company’s supply chains are in the clear and are compliant with U.S. law.