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CCI Cracks Down: Probe Launched into Pernod Ricard's Alleged Brand-Pushing Plot in Delhi Liquor Wars
In a significant move shaking up India's liquor industry, the has ordered a detailed investigation into and several associates for suspected anti-competitive practices under the Delhi Excise Policy . The bench, led by Chairperson Ms. Ravneet Kaur alongside Members Mr. Anil Agrawal , Ms. Sweta Kakkad , and Mr. Deepak Anurag , found evidence of agreements that could distort competition in the Indian Made Foreign Liquor (IMFL) market. However, allegations of in country liquor tenders were dismissed for lack of sufficient proof.
From Tender Cancellations to Cartel Whispers: The Explosive Backstory
The case, Case No. 09 of 2024 , was filed by informant , a public interest advocate, targeting over 40 opposite parties—mostly liquor manufacturers, wholesalers, and retailers. It stemmed from turbulent tenders by Delhi's for country liquor supply in . Two tenders () were scrapped amid suspicions of bid leaks and suspiciously tight pricing (Rs. 421-423 per unit), hinting at collusion among players like Empire Alcobrev and Haryana Organics.
The plot thickened with the Excise Policy , aimed at unbundling manufacturing, wholesaling, and retailing to curb syndicates. Yet, alleged interconnected cartels exploited this: manufacturers like Pernod Ricard and Diageo allegedly used forums like the to fix wholesalers, offer uniform discounts across zones, and push brands via financial incentives. Pernod Ricard's market share allegedly jumped from 15% to 35% through corporate guarantees worth hundreds of crores to favored retailers, bypassing policy safeguards against related-party entanglements.
Informant's Blitz: and Shadow Deals
painted a picture of orchestrated manipulation. For country liquor tenders, he highlighted repeated participation by a small Haryana-Chandigarh clique, uniform price hikes (11-14%), and narrow bid bands signaling pools. On IMFL, he cited emails, complaints, and reports showing Pernod Ricard backing retailers like , , and with guarantees (e.g., Rs. 50 crore each to some), inconsistent credit notes favoring "South Group" cartels, and shared IP logins on the ESCIMS portal. Writ withdrawals and secret meetings allegedly carved up Delhi's 32 zones, flouting exclusivity bans.
No formal response came from the opposite parties, though Pernod Ricard sought a hearing, which CCI denied at this stage.
CCI's Razor-Sharp Scrutiny: Fails, But Vertical Ties Raise Red Flags
CCI meticulously sifted evidence from Excise Department replies and audits. Past tenders () showed negotiated uniform rates, but no smoking gun for —especially since the tender succeeded. IMFL documents were with , starving claims of proof.
The spotlight fell on Pernod Ricard under
(
). Defining the market as
"sale and supply of IMFL in NCT Delhi,"
CCI noted Pernod's dominant pan-India shares (13-18% in wines/spirits). An internal
email revealed plans for "strategic advantage" in 20 zones via Rs. 23 million guarantees to associates bidding aggressively—pure "sales maximisation" turning anti-competitive by inducing brand exclusion.
findings amplified risks: Wholesalers like (Pernod's partner) controlled 71.7% distribution, with proxies like Khao Gali (linked via 35% stake) pushing 45% stock from one source, stifling choice.
Key Observations from the Bench
"The Commission is of the view that purported arrangement entered into between Pernod Ricard and few retailers may result in distortion of supply which can eventually translate into distortion of demand."
"Such conduct is likely to have in as much as the non-dealing in the product of the competitors through vertical arrangements... is likely to result in restriction of choice to end consumers."
"Wholesalers acquiring retail licences through proxy ownership increase risk of concentration, thereby leading to exclusive arrangements and brand pushing which has the effect of stifling competition."
Probe Greenlit: What Lies Ahead for Delhi's Liquor Giants?
Under , CCI directed the to investigate within 90 days, focusing on Pernod Ricard, , Pathway HR Solutions, Universal Distributors, Khao Gali, Bubbly Beverages, Shiv Associates, and . Broader conduct or officers' roles (per ) could be probed.
This ruling underscores vertical restraints' perils in regulated sectors, potentially reshaping Delhi's liquor ecosystem post-policy rollback. As news reports note, it zeroes in on "brand pushing" while sparing —signaling CCI's evidence-driven scalpel amid ongoing /ED scrutiny.
The liquor trade braces: Will guarantees be deemed gateways to market foreclosure?
