CCI Orders DG Investigation into Pernod Ricard's Alleged Exclusive Dealing in Delhi IMFL Market
The Competition Commission finds a prima facie case of exclusive dealing under Section 3(4)(b) against Pernod Ricard and linked wholesalers and retailers in Delhi's IMFL market, directing a 90-day Director General investigation.
The Competition Commission of India, in an order dated 4 May 2026, directed its Director General to investigate Pernod Ricard India Private Limited and seven other opposite parties for alleged exclusive dealing arrangements in the Indian Made Foreign Liquor market in the National Capital Territory of Delhi. The Commission, constituted by Chairperson Ms. Ravneet Kaur and Members Mr. Anil Agrawal, Ms. Sweta Kakkad and Mr. Deepak Anurag, found a prima facie case under Section 3(4)(b) read with Section 3(1) of the Competition Act, 2002. The order simultaneously cleared 33 of the original 41 opposite parties, finding the allegations against them unsubstantiated. The DG has been given 90 days from receipt of the order to submit an investigation report.
The Dispute Before the Commission
The Information was filed by Mr. Mohit, described as a person working in the charitable field who also pursues public interest matters. He raised two broad sets of allegations. The first concerned bid rigging in tenders issued by the Department of Excise, Entertainment and Luxury Tax of the Government of NCT of Delhi for wholesale supply of country liquor during 2022–23. The second concerned cartelisation among liquor manufacturers, wholesalers and retailers during the implementation of the Delhi Excise Policy, 2021–22, which governed the sale and supply of IMFL.
The Informant named 41 opposite parties spanning major liquor manufacturers — including Pernod Ricard India Private Limited, United Spirits Limited (Diageo), Bacardi India Private Limited and Radico Khaitan Limited — as well as wholesalers, retailers, distributors and an industry association, the International Spirits and Wines Association of India.
Bid Rigging Allegations: Country Liquor Tenders
Three tenders for wholesale supply of country liquor in Delhi were at issue. The first, dated 22 April 2022, was cancelled after two bidders — Empire Alcobrev Private Limited and Haryana Organics (a unit of Globus Spirits Limited) — disclosed their financial quotes in the tender form, violating tender conditions. A fresh tender dated 24 May 2022 was then cancelled by the Excise Department on the ground that the rates quoted by bidders fell in a narrow band of Rs. 421 to Rs. 423, with the Tender Scrutiny Committee observing a possible formation of a pool by the bidders. Only the third tender, dated 27 January 2023, was awarded.
The Informant alleged that the narrow price range across the second tender, and a similar percentage increase of 11% to 14% per 9 bulk litres across participants in the third tender, pointed to coordinated bidding. He also relied on minutes of an Excise Department meeting dated 17 August 2022, which observed that despite wide publicity, the bidders for country liquor tenders had “more or less remained the same which are situated in Chandigarh & Haryana Only.”
The Commission examined the Excise Department's reply dated 18 February 2025 and the tender data for 2019–20, 2020–21 and 2021–22. It found that in each of those years, the Excise Department itself had entered into negotiations with all bidders and recommended that they accept rates as decided by the Negotiation Committee. On that basis, the Commission concluded there was insufficient information to indicate a prima facie case of bid rigging in the country liquor tenders.
On the IMFL tender allegations, the Excise Department informed the Commission on 2 February 2026 that documents relating to the grant of retail licences for IMFL supply in 2021–22 were with the Central Bureau of Investigation in connection with its investigation into the Excise Policy, 2021–22. The Commission accordingly found insufficient information to indicate a prima facie case of bid rigging in the IMFL tenders as well.
Cartelisation Under the Excise Policy, 2021–22: The Case Against Pernod Ricard
The Excise Policy, 2021–22 was implemented on 17 November 2021 and ran until 31 August 2022, when the Government of NCT of Delhi discontinued it and reverted to the earlier regime. The policy had sought to unbundle manufacturing, wholesaling and retailing of liquor to prevent coordination or nexus resulting in unfair advantage to certain brands.
The Informant alleged that Pernod Ricard used the platform of ISWAI to reach an understanding with Diageo to have exclusive arrangements with their respective chosen wholesalers, thereby avoiding competition between them. He further alleged that Pernod Ricard appointed Indo Spirits Private Limited as its wholesaler knowing that Indo Spirits had retail presence through Khao Gali Restaurants Private Limited, and that Pernod Ricard devised an arrangement with Indo Spirits and selected retailers to mandate 35% stock of its brands, backed by financial assistance of Rs. 200 crore in the form of corporate guarantees.
The Informant also alleged that Pernod Ricard issued credit notes inconsistently: Rs. 61.01 lakhs in credit notes were given to Organomix Ecosystems Private Limited, which had purchased 17,644 cases during December 2021 to February 2022, while Adharv Enterprises, which had purchased 19,080 cases in the same period, received nothing. It was further alleged that operations of Sri Avantika Contractors (I) Limited, Trident Chemphar Limited and Organomix Ecosystems on the ESCIMS portal were conducted from the same IP address on numerous occasions.
On the allegation that writ petitions were withdrawn pursuant to an understanding among Pernod Ricard, Diageo, Indo Spirits and Brindco Sales to divide the Delhi liquor market, the Commission found this was not sufficiently made out to attract Section 3(3) of the Act, as there was no corroborative evidence of a horizontal agreement between manufacturers operating at the same level.
How the Commission Reasoned on Exclusive Dealing
The Commission analysed Pernod Ricard's alleged conduct under Section 3(4) of the Act, which governs vertical agreements. It identified the relevant market as the “market for sale and supply of IMFL in the NCT of Delhi,” noting that trade in liquor is primarily state-regulated and that the Excise Policy, 2021–22 was specific to Delhi.
On Pernod Ricard's market position, the Commission drew on CMIE database figures showing that Pernod Ricard held the highest market share in wines, spirits and liquors in India continuously from 2019–20 to 2023–24, ranging from 17.9% to 13.59%. The Commission treated this as prima facie indicative of a position of strength sufficient to cause appreciable adverse effect on competition under Section 3(4) of the Act.
The Commission placed weight on an internal e-mail dated 13 July 2021 circulated among Pernod Ricard employees, which stated that the company was working towards creating conditions for strategic advantage in 20 out of 32 proposed retail zones in Delhi and intended to provide financial support to four associates bidding for eight zones, with support described as 23 million euros in the form of corporate guarantees for three-year loans provided by HSBC.
The Commission also relied on the CAG Report of 2025, which found that wholesale distribution of liquor in Delhi was largely controlled (71.70%) by three entities — Indo Spirits, Brindco Sales and Mahadev Liquors — and that the former two exclusively supplied brands of Diageo, United Breweries (Heineken) and Pernod Ricard. The CAG Report further noted that Indo Spirits and Khao Gali are related entities, with Indo Spirits Distribution Limited holding a 35% stake in Indo Spirits and both being under common control as per MCA database records. The Report also found that Khao Gali procured 45.26% of its stock from Indo Spirits, raising concerns of brand pushing and limitation of consumer choice.
The Commission reasoned that where corporate guarantees become a mechanism to guide retailers to exclude competing products, the conduct assumes anti-competitive character. It found that the alleged arrangement between Pernod Ricard and retailers was likely to distort retail demand by moving it away from competing brands artificially, potentially driving existing competitors out of the market and restricting consumer choice.
Pernod Ricard's Application for Preliminary Hearing
Pernod Ricard had filed an application dated 17 February 2025 seeking an opportunity to respond to the allegations and a preliminary hearing before the Commission. The Commission considered the application in its ordinary meeting on 12 March 2025 and relisted it. On considering the Information, the Commission concluded that sufficient evidence existed to form a prima facie opinion and that a preliminary hearing was not required at this stage. The application was accordingly disposed of.
Order
The Commission directed the Director General to investigate the matter under Section 26(1) of the Competition Act, 2002 in relation to the alleged conduct of Pernod Ricard India Private Limited, Indo Spirits Private Limited, Pathway HR Solutions Private Limited, Universal Distributors, Khao Gali Restaurants Private Limited, Bubbly Beverages Private Limited, Shiv Associates and Organomix Ecosystems Private Limited. The remaining opposite parties named in the original Information were removed from the array of parties.
The DG was directed to complete the investigation and submit a report within 90 days of receipt of the order. The Commission clarified that if the DG encounters anti-competitive conduct by any other entity during the investigation, the DG is at liberty to investigate that conduct as well. The DG was also directed to investigate the role of persons and officers responsible for the conduct of the entities concerned, including those whose consent or connivance may have enabled the alleged contravention, under Section 48 of the Act. The Commission stated that nothing in the order constitutes a final expression of opinion on the merits.