Reebok India which is now a subsidiary under the German sports goods-maker Adidas has allegedly violated the FEMA guidelines ad was booked by the enforcement directorate ED. For the violation of Foreign Exchange Management Act, Reebok India may have to face the penal action and charges of money laundering for the breach of export commitments and also running outlets without appropriate authorization.

The FEMA violation that has been charged against Reebok India was the failure of the company to export goods worth Rs 8000 crore in the first 10 years of the functioning.

It had also breached the commitment of not engaging in retail sales. Apart from these commitments it has also accepted not to import sporting goods that could be manufactured in India. ED investigations revealed that the firm had hardly involved in any manufacture, and instead had imported everything from their manufacturing units in South East Asia.

The Serious Fraud Investigation Office in the corporate affairs ministry has also started its investigations against Reebok India seeking details regarding the unauthorized outlets in the country which as per the complaint of Reebok India were started by unauthorized officials and were removed after they were identified.

(AW- Anil)