An ongoing controversy in Nepal involving the alleged misuse of foreign direct investment (FDI) structures linked to a local partner associated with ride-hailing platform InDrive has prompted calls for heightened regulatory scrutiny in other markets where the company operates, including Pakistan.
The issue surfaced following an investigative report by Nepalese media outlet AarthikNews, which alleges that Hemraj Dhakal, Vice-Chairman of Nepal’s IME Group, structured transactions enabling the outflow of approximately USD 4 million (NPR 570 million / PKR 1.1 billion) under the cover of FDI-related arrangements.
While the matter remains under investigation in Nepal, financial and regulatory experts say the case highlights structural vulnerabilities that can arise when multinational digital platforms operate through layered corporate, licensing, and investment arrangements — particularly in jurisdictions with foreign exchange controls and evolving oversight of digital services.
Questions for Pakistani Regulators
Industry observers argue that the developments in Nepal warrant a closer, preventive review by relevant Pakistani regulators, including the State Bank of Pakistan (SBP), Federal Investigation Agency (FIA), Securities and Exchange Commission of Pakistan (SECP) and Federal Board of Revenue (FBR), given InDrive’s operational presence in major Pakistani cities.
Key areas experts suggest may merit examination include:
- Nature of Legal Presence:
Whether InDrive operates in Pakistan through a locally incorporated subsidiary, a foreign company branch, or third-party contractual arrangements, and how ownership, control, and decision-making authority are structured. - Capital and Payment Flows:
Whether any funds categorized as foreign investment, technology fees, service charges, commissions, or royalties are being remitted abroad, and under which regulatory permissions or exemptions. - Tax and Transfer Pricing Compliance:
How revenues generated in Pakistan are being reported, taxed, and reconciled with payments to foreign parent or affiliated entities, including alignment with transfer pricing regulations. - Profit Repatriation Mechanisms:
Whether commission-based or revenue-sharing models could function as indirect capital outflows without triggering enhanced regulatory review.
Analysts emphasize that these questions are preventive in nature. And do not imply wrongdoing in Pakistan. But reflect the need for transparency and consistency in oversight of fast-growing cross-border digital platforms.
Corporate Structure and Intellectual Property Ownership
Regulatory experts further note that InDrive’s global corporate structure is a relevant consideration for due-diligence and supervisory reviews.
According to publicly available corporate records, SUOL Innovations Ltd.. A Cyprus-registered entity, serves as the parent company for InDrive’s local operating companies worldwide. And holds the intellectual property rights to the InDrive application. Local InDrive entities operate under licensing, service, or affiliate arrangements connected to this parent company.
While centralized ownership of intellectual property is common among multinational technology platforms. Experts caution that such structures can create material cross-border financial flows. Including licensing fees, technology payments, and intercompany service charges. In jurisdictions with foreign exchange regulations and capital controls. These mechanisms are typically subject to heightened disclosure, valuation scrutiny, and regulatory approval.
Financial analysts stress that the existence of a foreign IP-holding parent company does not in itself indicate misconduct. But underscore the importance of clear regulatory visibility into how such arrangements impact capital movement. Taxation, and compliance with anti–money laundering and counter-terror financing frameworks.
Learning From the Nepal Case
According to the Nepalese investigation, the alleged transaction involved routing funds through foreign-registered entities, followed by rapid share valuation adjustments that facilitated significant capital transfers abroad. The matter reportedly came to light only after a local bank declined to process a foreign exchange settlement.
Experts caution that similar regulatory blind spots — if left unaddressed — could expose other jurisdictions to financial integrity risks, particularly in countries managing FATF compliance obligations and capital account restrictions.
Call for Proactive Oversight
Financial observers note that Pakistan has previously strengthened oversight of fintech firms, ride-hailing platforms, and digital service providers. They argue that early-stage regulatory review, rather than reactive enforcement, can help ensure:
- Compliance with SBP foreign exchange regulations
- Alignment with SECP corporate disclosure and ownership requirements
- Adherence to FIA AML/CFT frameworks
- Consistent monitoring by FBR of Pakistani-registered entities and cross-border payments
Status of the Case
The allegations in Nepal remain under investigation, and no final findings have been announced by authorities. Neither InDrive nor the individuals named in the Nepalese report had issued a public response to the claims at the time of publication.
