According to Reuters, India’s appellate authority on Friday, September 30, upheld the seizure order against Chinese smartphone maker Xiaomi Corp. 

The order allows the freezing of $682 million in an investigation of its alleged violation of Indian foreign exchange laws.

In April, India’s Enforcement Directorate found that the firm sent 55.5 billion rupees in foreign currency to three foreign-based entities, including a Xiaomi entity. The activities were posed as royalty payments. 

Reuters reported that Xiaomi had denied wrongdoing at the time and challenged the decision in an Indian court. The matter was then sent to the appellate authority’s review.

After the decision on Friday, the Indian Enforcement Directorate said, “Under the cover of various unrelated documentary facade created amongst the group entities, the company remitted this amount in guise of royalty abroad.” The agency said that Xiaomi’s action violates India’s foreign exchange laws.

Xiaomi on Sunday said it was “disappointed” with the decision and vowed to continue defending its interests in the country. It said, “We will continue to use all means to protect the reputation and interests of the company and our stakeholders.”

According to the South China Morning Post, Xiaomi has recently laid off over 900 workers after its sales plunged 20% and net income dropped over 80% in the second quarter. AP reported that the U.S. Department of Defense blacklisted Xiaomi and eight other Chinese companies for alleged military ties in 2021.

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