Xiaomi was shocked by the seizure of assets worth $ 68 million, the company denies wrongdoing

Chinese smartphone company Xiaomi has said that it is disappointed with the Enforcement Directorate’s (ED) action to confiscate its assets worth about $682 million. The company said it would continue to protect its assets and interests. Xiaomi said that more than 84 percent of the seized assets were royalty payments made to American chipset company Qualcomm.

About this Xiaomi “We will use all means to protect the goodwill and interests of the Company and our stakeholders,” it said in a statement. The company said that its unit in India is a subsidiary of Xiaomi Group, which has entered into a legal agreement with Qualcomm for Intellectual Property (IP) license for manufacturing of smartphones. The statement said that Xiaomi has a valid commercial agreement with Qualcomm for the payment of royalty to the unit in India. However, in this regard, the competent authority of the country said that payment of royalty is only a means of transfer to foreign exchange outside the country and it is a gross violation of the provisions of FEMA.

ED It was told that this is the largest amount ever seized in the country. The ED had issued a confiscation order under FEMA about four months ago and then sent it to the competent authority for approval. This order was issued against Xiaomi’s unit in the country under Section 37A of FEMA. In this regard, the ED said, “The authority has confirmed the seizure of Rs 5,551.27 crore and said that the ED’s investigation has found it to be correct that the company had transferred this amount outside the country in an unauthorized manner and it was transferred to the group. Abroad in violation of Section 4 of FEMA on behalf of the entity.”

Xiaomi, which sells MI brand smartphones, has about 18 percent share in the country’s smartphone market. After tensions on the border between India and China about two years ago, many Chinese companies have faced difficulties in doing business in India. The central government had also banned more than 300 Chinese apps including Tiktok for security reasons.

(This news has not been edited by NDTV team. It has been published directly from Syndicate feed.)<!–

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