 "Vivo becomes third brand to exit Germany")
Probe agency Enforcement Directorate (ED) has alleged that Chinese smartphone maker Vivo India had created an "elaborate and well-knit network pan India structure" of firms to "cheat" government authorities, according to a report by The Economic Times (ET).
ED has claimed in a court filing that these firms were created as a part of a "criminal conspiracy" to "utilise Indian companies as a front to get a foothold in Indian territory in gross violation of the extant foreign direct investment (FDI) norms from 2014-15 till 2017-18".
According to the probe agency, a total of 19 firms were set up after the creation of Vivo India (in 2014), which were "ultimately controlled" by Ms/ Vivo Mobile Communication Co China. Earlier this week, the agency had arrested three executives of Vivo India and the managing director of Lava International.
The probe agency also said that employees of Vivo and its Indian affiliates concealed their employment with the Chinese firm when seeking visas.
ED has claimed that at least "30 Chinese individuals entered India using business visas with the intent to work as employees in Vivo companies. Though they worked for Vivo companies in India, they never disclosed Vivo companies as their employer in their visa applications". It also claimed that Vivo employees breached rules by visiting the "sensitive" Himalayan region of Jammu and Kashmir.
"Many employees of Vivo group companies worked in India without appropriate visas," ED said in the filing. "They have concealed information regarding their employer in their visa applications and cheated the Indian embassy or missions in China."
Last year, the agency raided 48 sites linked to Vivo and its associates in the money laundering investigation, accusing the company of illegally siphoning money to China through its indirectly controlled firms.
