India's competition watchdog probes Pernod Ricard's market practices

Pernod Ricard's market practices: India's competition watchdog is examining allegations of collusion between France's Pernod Ricard and retailers in New Delhi to enhance market share, news agency Reuters reported quoting the legal documents.

With brands like Chivas Regal and Absolut vodka, Pernod holds a 17 per cent market share in the liquor market, which it claims is its second-largest globally by net sales. However, the spirits giant faces regulatory challenges, including licensing, tax issues, and antitrust probes.

The accusations stem from a confidential filing made in March by an individual known only as Mohit, renowned for raising public interest litigation, detailing alleged malpractices in the liquor industry.

The Competition Commission of India (CCI) is scrutinising the case and can initiate a full investigation or dismiss the allegations based on evidence, according to an anonymous source familiar with the matter, according to the report.

Pernod is accused of leveraging its influence to persuade New Delhi retailers to stock more of its products in exchange for assistance in securing loans for store licenses.

In response, Pernod stated it had not been formally informed of the antitrust case but reiterated its commitment to abide by local laws and ensure compliance among its teams.

The complainant's assertions largely rely on findings by India's financial crime agency, the Enforcement Directorate, investigating Pernod's alleged involvement in a corruption case related to the city's liquor policy.

Among Pernod's ongoing challenges, it has been unable to obtain a retail license for its products in New Delhi for over a year. Additionally, it faces an antitrust investigation in south India and disputes a tax demand of nearly $250 million for allegedly undervaluing imports.

Pernod has consistently denied any wrongdoing in these cases, stressed its commitment to legal compliance and ethical business practices.

(with Reuters inputs)