What you need to know
- India's Income Tax department is raiding OPPO's distribution partners in the country.
- Similar raids were also made by country's Enforcement Directorate (ED) recently.
- The Indian government wants BBK-owned brands such as OPPO and Vivo to leverage local companies for distribution.
India's Income Department is conducting raids at the offices of OPPO and OnePlus' Chinese distribution partners in Rajkot and Hyderabad, according to a report from The Economic Times. Similar raids are also being carried out at the offices of Xiaomi's offices in various cities across the country, based on "intelligence input" on tax evasion and concealed income.
The raids come just week after one of OPPO's Chinese distribution partners was penalized in hundreds of crores by the country's Enforcement Directorate in Hyderabad. According to sources familiar with the matter, the Income Tax department could soon conduct similar raids at the offices of OPPO's other distribution partners across the country.
As per a report published by ET in October, the Indian government is working on pushing BBK-owned smartphone brands to leverage local companies instead of operating through Chinese distribution partners in the country. Since there's currently no legal framework that allows the government to bar such operations, it has apparently decided to "unofficially" convey its stance to the companies.
In a statement to Android Central, OPPO said it was cooperating with the authorities' enquiry:
As an invested partner in India, we highly respect and abide by the law of the land. We will continue to fully cooperate with authorities concerned as per procedure.
Xiaomi shared a similar statement:
As a responsible company, we give paramount importance to ensuring that we are compliant with all Indian laws. As an invested partner in India, we are fully cooperating with authorities to ensure they have all the required information.
The government is developing a legal framework that could have a clause around working with distribution companies belonging to countries that share borders with India. OPPO and its sister brand Vivo are among the most popular smartphone makers in the country, with a particularly strong presence in the offline segment. Both brands currently rely on Chinese partners to distribute their best Android phones inn the Indian market.