The main financial crime-fighting agency of India had been investigating the Marlboro maker, Philip Morris International Inc. alongside its Indian partner Godfrey Philips for alleged breach of the country’s law, a senior directorate source revealed to a press agency on Friday, the 8th of March 2019.
According to the source with direct knowledge regarding the subject matter, the enforcement directorate had been investigating both of the companies, and the scope of the probe could have become much more widened, which initially appeared as an alleged violation of foreign investment law.
In fact, for year, the Philip Morris International Inc. had been paying the manufacturing costs to Godfrey Philips for making their Marlboro Cigarettes, bypassing a nine-year-old government ban on foreign direct investment in the tobacco industry, the origin of which dated back to May 2009.
After reviewing the Philip Morris documents, three former officials, alongside one former head of enforcement directorate said that the dealings should be probed for violating India’s direct investment rules.
On Friday (March 8th), a spokesman from the Enforcement Directorate had been quoted saying in a press report that the issue had already been under investigation and both of the companies were being probed on alleged violation of foreign direct investment rules.
Neither Philip Morris, nor Godfrey Philips immediately responded while being asked about the subject matter.