Xiaomi assessing reasons for 3.2m euro fine in Italy

Xiaomi Corp said it was assessing the reasons behind a 3.2 million euro fine ($3.2 million) by an Italian regulator, as it has always adhered to legal and compliance operations, abiding by local relevant laws and regulations.

The comments came after the media reported that the Italian Competition Authority fined Xiaomi's Italian subsidiary for alleged violations of warranty rules for the repairs of electronic devices.

It is of high importance for Chinese companies to comply with local laws and regulations while going global, and the legitimate rights and interests of Chinese companies should also be safeguarded, experts said.

Xiaomi said it was aware of the fine and assessing the reasons behind it. The Beijing-based company said it is committed to providing every Italian consumer with good after-sales service experiences.

The Italian authority outlined allegations that several of Xiaomi's policies for fixing defects violated consumer rules in the country. For instance, Xiaomi's local unit refused repairs it was obliged to make in the presence of minor defects not covered by the warranty, such as small scratches, according to a report from telecom industry news website Mobile World Live.

Xiaomi accounted for 19.7 percent of smartphone shipments in Europe in the first quarter, and its market share in Western Europe stood at 15.4 percent, the latest data from market research company Canalys showed.

The fine in Italy came as Xiaomi is ramping up a push to expand its business presence in Europe, which is one of the most important markets for the company.

Ding Jihua, deputy director of the Beijing New Century Academy on Transnational Corporations, an institute that focuses on the study of multinational enterprises, said Xiaomi has been in Italy for several years, and the reasons why Xiaomi was fined were still not that clear.

Companies must attach high importance to compliance with laws and regulations of different markets while going global, Ding said.

Xiaomi's overseas business recorded robust growth as the company continued to advance its overseas strategy last year. In 2021, its revenue from overseas markets reached 163.6 billion yuan ($24.2 billion), increasing 33.7 percent year-on-year and accounting for 49.8 percent of its total revenue.

Lei Jun, chairman and CEO of Xiaomi, said earlier this month that the company is expected to invest more than 100 billion yuan into research and development over the next five years as part of its broader push to sharpen its R&D capabilities and explore new technologies.