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India Investigates Pernod Over Retailer Collusion Claims
9 May
Summary
- Pernod Ricard faces investigation for alleged exclusive deals with retailers.
- Claims suggest company supported retailers to promote its brands.
- India's antitrust watchdog found merit in the allegations of market distortion.
India's antitrust watchdog, the Competition Commission of India (CCI), has initiated an investigation into Pernod Ricard concerning allegations of colluding with retailers. The probe focuses on claims that the French liquor giant engaged in exclusive deals to exclusively promote its brands, thereby disadvantaging competitors.
The CCI's order, issued on Friday, indicated that the allegations hold merit. Evidence suggests Pernod Ricard may have offered corporate guarantees to facilitate loans for city retailers. In return, these retailers allegedly committed to dedicating a substantial portion of their stock to Pernod's brands.
An internal Pernod email from 2021, referenced in the CCI's order, discussed achieving a "strategic advantage" and providing financial support to retailers bidding for licenses. The CCI views this as an action likely to distort retail demand and restrict consumer choice, rather than benefit them.
This investigation adds to Pernod Ricard's challenges in India, which is its largest market by sales volume. The company, known for brands like Chivas Regal and Absolut vodka, is already facing a separate federal tax demand and another probe into alleged liquor policy violations. Pernod Ricard has previously denied wrongdoing in ongoing legal and public challenges.
