newtech

Directorate of Enforcement seizes $725 million from Xiaomi India

xiaomi.png

Picture: Xiaomi

India’s anti-money laundering agency, Enforcement Directorate (ED), has seized assets worth ₹5,551.27 crore (about $725 million) from Xiaomi India after discovering that the company had violated foreign exchange laws.

In 2014, the company started operations in India and reportedly started the illegal activity in 2015. The ED claimed that Xiaomi India handed over foreign currency to three offshore entities under the guise of royalties, one of them they included a company within the Xiaomi group, while the others were based in the United States.

Additionally, the ED said the payments were made “on the instructions of their parent group’s Chinese entities.”

Xiaomi India replied by Twitterclaiming that their financial processes comply with Indian laws and regulations.

“We believe our royalty payments and statements to the bank are all legitimate and truthful,” the company said in its response.

“These royalty payments made by Xiaomi India were for licensed technologies and IP addresses used in our Indian version products. It is a legitimate business agreement for Xiaomi India to make such royalty payments.”

Xiaomi India, however, pledged “to work closely with government authorities to clarify any misunderstandings.”

After seeing 83% year-over-year growth in the second quarter of 2021, parent company Xiaomi reached 17% market share for smartphones, overtaking Apple, and eventually Samsung, to briefly take the lead. first place in the global smartphone market, according to Counterpoint Research.

RELATED COVERAGE



Source link

READ MORE:  Éva Tardos named ACM Athena Lecturer

Leave a Comment