India investigates Google, Yahoo for forex violation

India investigates Google, Yahoo for forex violation

Summary: Government investigating Internet companies' India offices for alleged violations of foreign exchange rules when transferring funds to and from country, according to a report.

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TOPICS: Legal, CXO, India
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India's officials are investigating if the local offices of Google and Yahoo have violated foreign exchange rules when sending and receiving funds from their overseas counterparts.

In a Wall Street Journal (WSJ) report Monday, it was reported that India's federal finance ministry, which tracks foreign exchange transactions and money laundering activities, have sent notices to the local branches of Google and Yahoo, according to an unnamed senior official. The Web companies are being investigated for potential foreign exchange violations, the source added.

A Google India spokesperson pointed out that it had not received the notice and was not able to comment on specific details. Yahoo India declined to comment, said the report.

The Google spokesperson also told WSJ: "We have an obligation to our shareholders to set up a tax efficient structure and our present structure is compliant with the tax rules in all the countries where we operate...We make a very substantial contribution to local and national taxation and provide employment for close to 2,000 people in India."

This is not the first instance these two Web giants have crossed swords with India's authorities. Last week, they, together with 20 other Internet companies, were told to remove offensive content from their Indian sites as ordered by the Indian government.

Topics: Legal, CXO, India

Liau Yun Qing

About Liau Yun Qing

The only journalist in the team without a Western name, Yun Qing hails from the mountainy Malaysian state, Sabah. She currently covers the hardware and networking beats, as well as everything else that falls into her lap, at ZDNet Asia. Her RSS feed includes tech news sites and most of the Cheezburger network. She is also a cheapskate masquerading as a group-buying addict.

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