India Orders Probe into Pernod Ricard Over Anti-Competitive Deals

New Delhi: India has ordered an investigation into French spirits giant Pernod Ricard over allegations that it struck special deals with retailers to unfairly promote its products over rivals.

The company, whose brands include Absolut vodka, Chivas Regal whiskey and Beefeater gin, allegedly “offered 200 crore rupees (about $22 million) in financial assistance to retailers in the form of corporate guarantees” in 2021.

The complaint alleges that Pernod Ricard provided these guarantees in exchange for requiring its brands to make up 35 percent of the inventory sold in retailers’ stores.

The regulatory order issued by the Competition Commission of India (CCI) on Friday stated that the investigation was ordered on the grounds that “…vertical arrangements between Pernod Ricard and retailers may lead to distortion of demand by artificially shifting retail demand from competing brands to Pernod Ricard, thereby pushing existing competitors out of the market.”

The antitrust watchdog said that “such action would likely result in end consumers being restricted in their choices rather than benefiting them in any way.”

According to the CCI order, the allegations were made by a person named Mohit, who lives in the western city of Jaipur.

Following the proposed financial aid, “Pernod Ricard’s market share increased from 15 percent to 35 percent and had planned to increase this to 47 percent over a three-year period,” according to the complaint.

According to the company’s website, it “has one of the most dynamic and premium portfolios” in the alcoholic beverage industry and has around 1,600 employees in India.