After a dispute between local officials in India and Xiaomi over patent fees, a lobby group composed of apple and other technology giants operating in India publicly pointed out that the Indian authorities misunderstood the operation of patent fees The Indian mobile phone and Electronic Products Association (ICEA) has sent letters to several relevant departments in India, urging the federal government to intervene, and accusing the country's law enforcement agencies of "lack of understanding" of the royalties in the technology industry. Xiaomi, oppo, Indian local enterprise lava, apple and its suppliers Foxconn and Wistron are all members of ICEA
Earlier, the Indian anti money laundering agency accused Xiaomi of transferring funds abroad and falsely claiming that it was used to pay patent fees. In April this year, the agency frozen more than US $700million of the local subsidiary of Xiaomi in India. Xiaomi raised an objection to India's asset freeze, saying that the company's royalties and bills were all legal and true, and the statements submitted to financial institutions were accurate. This freezing of funds was later put on hold pending a final decision by the court.
Although the letter of ICEA did not specifically mention the Xiaomi case, it warned that accusing enterprises of illegally paying royalties might have a "chilling effect" on the Indian business environment, because the Indian authorities would also apply similar interpretations of royalties to other companies.
In a letter to the Federal Minister of finance, trade and science and technology of India on May 30, ICEA said that the law enforcement authorities had taken a "position" and believed that royalties were a simple way to bring funds out of India. "We understand that it is the responsibility of Indian agencies to identify misconduct, but in this case, they did not fully understand the situation. Patent implementers face a double dilemma, on the one hand, they have to pay heavy patent fees, on the other hand, they are afraid of law enforcement actions." ICEA said in the letter.
India's ministries of finance, trade, science and technology and anti money laundering agencies have not yet commented