An Indian court has dismissed a petition by Chinese smartphone manufacturer Xiaomi Corp (1810.HK) challenging the seizure of INR 55.51 billion ($676 million) in assets, according to two sources familiar with the situation.
The company's assets in India were frozen last year by the federal financial crime agency, which claimed that Xiaomi made illicit remittances to foreign entities under the guise of royalty payments.
In response to the ruling by a court in Karnataka state, a Xiaomi spokesperson said, "We are studying the matter and waiting for the written order." The spokesperson added that the company's operations in India comply with local laws and regulations. Xiaomi has previously stated that all its royalty payments were legitimate and that it would "continue to use all means to protect the reputation and interests."
Xiaomi has lost its position as India's top choice for smartphones to competitor Samsung Electronics (005930.KS), as Indian consumers seek enhanced features in the world's second-largest market for these devices. Chinese companies have faced challenges in conducting business in India since 2020 due to political tensions resulting from a border conflict.
India has banned over 300 Chinese apps, including popular ones such as TikTok, citing security concerns since the clash. Additionally, the country has tightened regulations for Chinese companies investing in India.
