India's Serious Fraud Office Recommends Probe into Xiaomi's Business Practices
India’s Serious Fraud Office (SFIO) has recommended an in-depth investigation into Xiaomi for potential violations of foreign investment laws and irregularities in its business model. The probe would examine fund movements, compliance with mandatory approvals under tightened regulations post-2020 border clashes between India and China, and whether beneficial ownership or control changes were properly disclosed. The recommendation comes amid a broader context where Xiaomi has faced declining market share due to competition from Apple and Samsung in India. It also follows ongoing disputes over tax demands and royalty payments. The SFIO’s proposal is currently under review by the Ministry of Corporate Affairs, with no set timeline for approval or rejection. Xiaomi stated it had not received any formal notice but emphasized its full compliance with local laws. Meanwhile, China's foreign ministry expressed hope that India would maintain a fair business environment for all companies.
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Topics: Chinese investments compliance India SFIO investigation Xiaomi