In Short:
Xiaomi India announced it was named an “opposite party” in a Competition Commission of India (CCI) investigation without proper notice. The inquiry examines whether smartphone brands, including Xiaomi, breached competition rules by launching exclusive models online. Xiaomi’s revenue has dropped for two consecutive years. They are seeking access to confidential investigation documents to prepare their defense. Xiaomi’s market position fluctuated, recently falling to rival Vivo.
Kolkata: The Chinese smartphone manufacturer Xiaomi Technology India has announced, in a recent regulatory filing to the Registrar of Companies (RoC), that it has been designated as an “opposite party” in the latest investigation report from the Competition Commission of India (CCI). Xiaomi has raised concerns regarding this classification, stating that it was not provided with prior notice or an opportunity to be heard. Furthermore, the company may be included in a “confidentiality ring” to adequately defend its position.
According to the filing, Xiaomi India is facing multiple regulatory investigations within the country, which have contributed to a decline in its revenues for the second consecutive year in the fiscal year 2023-24.
Details of the CCI Investigation
The CCI’s investigation focuses on allegations that several smartphone brands, including Xiaomi, have been launching exclusive models on notable e-commerce platforms such as Amazon and Flipkart, purportedly violating India’s competition regulations. The confidentiality ring established by the CCI permits parties access to the confidential information of other entities, which is necessary for effective self-defense.
Xiaomi noted in its filing dated October 19 that it received a non-confidential, heavily redacted version of the Director General (DG) report from the CCI. Consequently, the nature of the allegations, the basis for them, and the evidence involved remain unclear. The DG had originally sought information from Xiaomi in its capacity as a third party and did not classify the company as an opposite party until the report was issued, according to the company.
Response and Future Steps
Xiaomi confirmed that it is currently analyzing the CCI order, the DG report, and other related documents that have been shared with it. The company has filed applications to constitute a confidentiality ring to gain access to the complete and confidential version of the reports and accompanying documents. Xiaomi emphasized that any further actions will be determined only after obtaining comprehensive information and access to the full DG report and related case records.
Market Position
After losing its market leadership position to Samsung in the fourth quarter of 2022, Xiaomi slid to fourth place in the market rankings. However, a turnaround occurred in the second quarter of 2024, where Xiaomi reclaimed its top position driven by aggressive expansion in offline retail and an updated product portfolio targeting the entry to mid-segment market. Despite this, the company once again lost the leadership title to rival Vivo in the most recent quarter.
