According to India’s financial crime department, several Chinese smartphone manufacturer Vivo employees and its Indian affiliates lied about their employment while applying for visas, and some of them broke the law by traveling to the “sensitive” Himalayan area of Jammu and Kashmir.
Following border confrontations in 2020 that resulted in the deaths of 20 Indian and four Chinese troops, New Delhi imposed restrictions on inbound investment and banned hundreds of Chinese applications. As a result, tensions with Beijing over corporate operations are rising.
The claims, described on Tuesday in a secret court document, come after the arrest of Guangwen Kuang, a Vivo executive, in connection with a money laundering probe started in 2022 against India’s second-largest smartphone manufacturer. The Enforcement Directorate said in a 32-page document that at least 30 Chinese nationals who visited India on business visas and worked for Vivo “never disclosed” this information on their application forms.
For the first time, it stated, adding light on the alleged offenses, “Various Chinese nationals have been traveling across India, including sensitive places of Jammu and Kashmir and Ladakh, in gross violation of Indian visa conditions.”
“Many employees of Vivo group companies worked in India without appropriate visas,” the agency claimed in the submission. “They have concealed information regarding their employer in their visa applications and cheated the Indian embassy or missions in China.”
When contacted for comment, Vivo, which has a 17% market share, reaffirmed an earlier this week statement stating that the executive’s detention “deeply concerns us” and that the company remained “dedicated to legal compliance.”
After declaring last week that it was closely monitoring the matter, China’s foreign ministry declined to comment when contacted by Reuters.
The Indian embassy in Beijing and the New Delhi foreign ministry did not comment. India and China contend they hold significant portions of territory in the western Himalayas as part of their long-running border dispute.
Ladakh and the regions of Jammu and Kashmir that India has declared as “protected” are off-limits to foreigners, and they are also prohibited from entering or remaining there without permission from the government, which is a different document from a visa. The agency seized 48 facilities related to Vivo and its accomplices in the money laundering probe last year. Vivo was accused of unlawfully funneling funds to China through firms it indirectly controls to escape paying taxes in India.
According to a court document filed this week, Vivo sent some trading entities owned by its Chinese parent company 1.07 trillion rupees ($12.87 billion) through what the agency dubbed a “masking layer” to avoid detection by the authorities.
“While no profits were shown from 2014-15 to 2019-20 in the statutory filings and no income taxes were paid … huge sums were siphoned off out of India,” the Enforcement Directorate stated.
The agency calculated that 624.7 billion rupees ($7.5 billion) had been transferred, primarily to China, in July of last year.
