A Red Flag Over Chinese Nationals As Company Directors
- The National Security Advisor has red-flagged Indian companies appointing Chinese nationals as directors without clearance from the Ministry of Home Affairs
- As many as 27 appointments in 2022 and six in 2023 in various companies controlled mostly by Chinese nationals in Hyderabad, Bengaluru, Mumbai, and New Delhi are under the central agencies’ scanner.
- Ministry of Corporate Affairs (MCA) vide Notification No. F. No. 1/22/2013-CL-V dated 1st June 2022 had notified that government clearance is a must for Chinese nationals’ appointment as directors in Indian companies.
- Notification issued by the government, requires nationals of land border-sharing nations who are appointed as directors on boards of corporations to receive a security clearance from the Ministry of Home Affairs in order to prevent Chinese enterprises from evading Indian rules in order to do business in the country.
- Among the companies is a supply chain firm incorporated in 2013 in Bengaluru. It made some foreign nationals as directors in August 2022, which the MCA is now verifying to determine whether there was a violation.
- In another instance, ROC Delhi is verifying the appointment of a Chinese national as director in a packaging firm located in Shyam Vihar in West Delhi. The company was incorporated in 2018, and a new director was appointed in September 2022.
- Similarly, a company located in the Pasha Mailaram industrial area in Hyderabad is also under the scanner. It registered with ROC Hyderabad, while the director applied before June 2022. It became effective in September 2022.
Source: TOI
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