Letter to Secretary Yellen on CCP Stronghold in American Battery Production

WASHINGTON, DC – Chairman Mike Gallagher (R-WI) and Rep. John Moolenaar (R-MI) of the House Select Committee on the Chinese Communist Party wrote to Treasury Secretary Janet Yellen, imploring her to withhold any federal support for Chinese battery companies in the US. The lawmakers specifically scrutinized the Department for greenlighting new plans for a Michigan battery factory owned and operated by CCP-backed, Gotion High-Tech Co.

Gallagher and Moolenaar identified shortcomings in the Committee on Foreign Investment In the United States (CFIUS) process, which is the multi-agency screening system led by the Department of Treasury. The CFIUS process is the primary way the U.S. Government restricts foreign adversaries from acquiring or otherwise investing in sensitive US assets and businesses. The lawmakers questioned why adversaries like the Chinese Communist Party could not only own and operate battery factories in the United States under Secretary Yellen's watch, but also remain eligible for US taxpayer subsidies.

In the letter, the lawmakers write, "Gotion High-Tech Co. is a PRC company that has direct ties to the CCP and state-owned financial institutions. Gotion has been an active participant in the PRC-based version of the “Thousands Talents Program” a program the FBI itself says encourages theft of trade secrets and economic espionage. Gotion has established multiple “Communist Party Units” within its operations and has publicly sought PRC provincial government support for its desire to expand its operations overseas... Even more worryingly, it appears that Treasury—as one of the primary implementing agencies behind the Inflation Reduction Act—may be offering Gotion large government subsidies for the project."

The lawmakers urged Congress and Secretary Yellen to take immediate action to stop the CCP from exploiting U.S. taxpayer dollars, asking Yellen to respond to the following questions no later than September 29th:

1.     Does Treasury intend to provide any U.S. taxpayer funding or other support to Gotion High-Tech Co. in connection with its construction of a lithium-ion battery manufacturing plant?

• Follow-up: If so, what is the amount of U.S. taxpayer dollars that Treasury plans to allocate for this project?

2.    Has Treasury been in communication with Gotion High-Tech Co. in connection with its plans to construct a lithium-ion battery manufacturing plant and possible tax inducements it could receive?

• Follow-up: If so, please describe the nature of these communications.

3.    Has Treasury been in communication with the State of Michigan—including but not limited to Governor Gretchen Whitmer’s office—regarding Gotion High-Tech Co.’s planned project? 

• Follow-up: If so, please describe the nature of these communications.

4.    Why does Gotion High-Tech Co.’s project not currently fall under the jurisdiction of CFIUS?

• Follow-up: What does Congress need to provide via new reforms to ensure these types of PRC projects fall under the jurisdiction of CFIUS?

Click HERE to view a copy of the letter.