India’s financial crime agency has taken into custody four executives of Chinese smartphone manufacturer Vivo, including one Chinese national. These arrests add to Vivo’s legal challenges in India and occur amidst heightened tensions between Beijing and New Delhi, spanning from border disputes to increased Indian scrutiny of Chinese businesses and investments.
The first source mentioned that Vivo executives were summoned for questioning at the ED’s Delhi office before being arrested. They are scheduled to appear in court later on Tuesday.
With a 17% market share in shipments, Vivo ranks as India’s second-largest smartphone brand, trailing Samsung, according to data from research firm Counterpoint.
In 2022, the ED froze 119 bank accounts linked to Vivo’s Indian operations, a move later revoked by the court. The ED’s case alleged that Vivo India illegally transferred 624 billion rupees ($7.5 billion) to China to “report significant losses” in India, thereby avoiding tax payments.
Indian authorities have also formally accused Vivo of facilitating illegal fund transfers to a news portal under investigation for spreading Chinese propaganda, as reported by Reuters last week. Vivo has not issued a statement on this matter.
Vivo and India’s Enforcement Directorate (ED) did not provide immediate responses to email and telephone inquiries.
Since a 2020 military clash on their disputed Himalayan border in which 20 Indian soldiers and four Chinese troops were killed, relations between India and China have soured considerably. India has subsequently banned numerous Chinese apps, citing national security concerns, and intensified scrutiny of incoming investments from China.
In July, carmaker BYD faced heightened scrutiny from New Delhi on its $1 billion proposal to manufacture electric cars and batteries in India, ultimately leading the EV maker to abandon its plans, as reported by Reuters. The arrested executives are linked to an ongoing 2022 case in which the ED conducted a raid on the company’s offices and accused it of money laundering. The company has consistently denied these allegations, stressing its cooperation with authorities and commitment to full compliance with the law. Vivo is a subsidiary of China’s BBK Electronics, which also operates brands like Oppo and Realme in India.