The Xiaomi Business Group in India was recently caught in the forex violation and breaking foreign trade policies of India. The Enforcement Directorate of India had reportedly seized the local bank account of Xiaomi India and impose a seizure of a total of $725 Million or INR 5,570 crores. The central probe agency of India has confirmed the following news.
A number of Chinese brands are facing troubles operating normally in the country after a political tension and border clash between China and India in 2020. The country has already tightened their rules and regulations for the Chinese brands to operate in India. After the seizure of Xiaomi India’s bank account, the company finally got hope as an Indian high court has put the seizure on hold.
Xiaomi India’s seizure by ED put on hold
After the Enforcement Directorate of India seized the company’s bank account saying that they have found the company illegally remitted funds to three foreign-based entities, including one Xiaomi group entity, “in the guise of royalty” payments. The ED has seized a total value of $725 million from the brand. A legal case is currently going on between the brand and ED of India and the final decision is yet to be announced.
The company denied any wrongdoing, claiming that its “royalty payments and bank statements are all legitimate and truthful.” Xiaomi India later appealed the Indian Financial Crimes Enforcement Agency’s decision in the High Court of the southern Karnataka state. The next hearing in the case is scheduled for May 12th, 2022.
After hearing from the brand and its lawyer, the Indian court has ordered the Enforcement Directorate of India to put the seizure on hold, until or unless any final decision has been made. A public announcement regarding this is yet to get published. Xiaomi is a leading smartphone brand in India with a market share of over 20-percents.