ByteDance’s Indian Bank Account Has Been Blocked, And Now It Can’t Even Pay Wages?

The aftermath of TikTok being completely banned in India is not over yet. The bank account of the parent company ByteDance has been blocked by the Indian government. Now it can’t even pay employees’ salaries, and it has even gone to court. What is going on?

According to Reuters, in mid-March this year, the Indian government believed that there was tax evasion in the online advertising transactions between ByteDance’s Indian branch and its Singapore branch, so it ordered the blocking of Bytedance’s Citibank and HSBC bank account.

According to people familiar with the matter, Indian authorities have also instructed Citibank and HSBC to prevent ByteDance from withdrawing funds from any other bank accounts related to its tax identification number. ByteDance’s lawyer reported that all four of the company’s bank accounts have been freeze, which will have a serious impact on the company's normal operations.

India's tax ministry said the directive came after a careful review of company office documents and inquiries last year over ByteDance's advertising and other dealings. In this regard, ByteDance expressed dissatisfaction and asked the court to revoke the blocking order to prevent the company from causing greater economic losses due to business stagnation.

According to ByteDance’s data, it has about 1,300 employees in India, most of which serve its overseas operations, including doing work such as content moderation. Although ByteDance’s banned bank account only contained approximately $10 million, the account ban order was an abuse of legal process and would make it difficult for the company to pay its employees, office rent, and taxes.

After ByteDance filed a lawsuit in court, the Bombay High Court decided to hear the case on April 6.

ByteDance said in a statement released on Wednesday that it was confident in its legal position and looked forward to a fair ruling from the court.

Last year, the Indian government announced its decision to ban more than 200 apps developed by Chinese manufacturers on the grounds of protecting national security and sovereign interests. TikTok is one of them. The market gaps left by the ban of these apps have been filled by Indian and Occupied by European and American companies, Chinese companies only have the choice of transformation or exit.

It is understood that Bytedance has laid off many employees in its Indian division in January this year and plans to sell TikTok’s Indian business to its local Indian competitor Glance.

Data shows that Galnce’s daily active users have reached 115 million, making it the largest content consumption platform in the Indian market after Facebook and YouTube, beating Instagram.