An investigation by India’s Directorate of Revenue Intelligence has found that Chinese smartphone maker Oppo evaded duties worth 43.9 billion rupees ($551 million), the government said in a statement on Wednesday. Indian investigators have found evidence that Oppo was improperly using duty exemptions for items imported for use in the manufacture of mobile phones, the statement said.
It also claims that Oppo made royalty payments that were not added to the transaction value of the imported goods as required by Indian law, he added. The government said a “duty demand notice has been issued to Oppo India”. A spokesperson for Oppo, which is owned by China’s BBK Electronics, said the company would review the announcement and respond.” We have a different perspective on the allegations,” an Oppo spokesperson said in a statement. “We believe this is an industry-wide problem that many companies are working on.” A spokesman said: “We will respond to the announcement, present our side and continue to work with the relevant ministries.”
The Revenue Intelligence wing has also proposed sanctions against Oppo India, its employees and Oppo China, a government statement said without elaborating. Many Chinese companies are struggling to do business in India after political tensions rose following a border clash in 2020. India has since cited security concerns as it banned more than 300 Chinese apps and tightened rules on Chinese investment. The action against Oppo comes amid increasing scrutiny of Chinese smartphone makers. The Federal Financial Crimes Agency’s Enforcement Directorate last week raided 48 locations of Vivo and its related entities, alleging that sales proceeds of Vivo India were diverted out of India to show losses and avoid paying taxes. India’s smartphone market leader Xiaomi is also under investigation, with the agency saying it made illegal transfers abroad “under the guise of royalties.” Both companies deny any wrongdoing.
