The Indian spirits market is facing a big regulatory shake-up as the Competition Commission of India (CCI) officially launched an antitrust investigation into Pernod Ricard, Reuters reported. The probe centers on allegations that the French liquor giant engaged in anticompetitive dealings with retailers to secure a dominant market position. This development marks a critical juncture for the company, as India represents its largest global market by sales volume, generating approximately $3 billion in the most recent fiscal year.
The investigation was triggered by a complaint from an individual known for public interest litigation, but the CCI’s decision to move forward hinges on specific internal evidence. Central to the case is a 2021 internal email in which Pernod executives reportedly discussed a plan to provide roughly $27 million in financial support to retailers bidding for licenses in New Delhi. The regulator suggests that this financial backing was intended to create a strategic advantage, effectively distorting retail demand to favor Pernod’s portfolio over its competitors, such as Diageo.
According to the CCI, such arrangements ultimately harm the marketplace by restricting consumer choice. When a manufacturer exerts undue influence over retail outlets, it can prevent a level playing field, ensuring its own products receive preferential placement or exclusivity at the expense of variety. While Pernod Ricard has publicly maintained that its operations adhere to the highest standards of governance and dismissed the allegations as meritless, the regulator’s investigative unit is now tasked with a deep-dive review that could span several months.
This antitrust probe is not an isolated incident but rather the latest in a series of legal and regulatory hurdles for the company in India. Pernod is currently navigating a $250 million federal tax dispute and separate investigations into violations of regional liquor policies. Despite the company’s formal denials, the scrutiny intensified following reports that an internal audit previously identified legal violations regarding retailer collusion in New Delhi.
