By R. Jai Krishna in New Delhi and Gillian Wong in Hong Kong
An Indian court has halted the imports of handsets from China's
largest smartphone maker, Xiaomi Inc., in response to a complaint
from Sweden's Ericsson that the Chinese firm was using Ericsson's
technology but refusing to pay royalties.
The High Court of Delhi said Xiaomi products wouldn't be allowed
into India and Xiaomi's main distributor, online retailer Flipkart
Internet Pvt. Ltd., wouldn't be allowed to sell Xiaomi products as
the court waits to hear Ericsson's complaint.
Court documents showed that the next hearing on the case is
scheduled for Feb. 5.
Xiaomi's lawyers are still looking into the court's order to
decide what it means and what it will do next, said Manu Jain,
Xiaomi's India operations head.
"India is a very important market for Xiaomi and we will respond
promptly as needed and in full compliance with Indian laws," he
said. "We are open to working with Ericsson to resolve this matter
amicably."
Xiaomi launched its first smartphone in India in July and
captured 1.5% of the Indian smartphone market in the third quarter,
according to Counterpoint Research. The research firm earlier said
Xiaomi was on track to double its market share this quarter.
Xiaomi's global vice president, Hugo Barra, said late last month
that Xiaomi had sold more than 500,000 devices in India by
October
Ericsson said it has tried for years to get Xiaomi to pay a
licensing fee for Ericsson technology that it built into Xiaomi
mobile devices.
"To continue investing in research and enabling the development
of new ideas, new standards and new platforms to the industry, we
must obtain a fair return on our R&D investments," said an
Ericsson India spokeswoman in a statement. "We look forward to
working with Xiaomi to reach a mutually fair and reasonable
conclusion, just as we do with all of our licensees."
Dhanya Ann Thoppil in Bangalore, India, contributed to this
article.
Write to R. Jai Krishna at krishna.jai@wsj.com
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