India has ordered a probe into French spirits giant Pernod Ricard over allegations of striking exclusive deals with retailers to unfairly boost its products over competitors.
The company, whose brands include Absolut vodka, Chivas Regal whisky and Beefeater gin, is alleged to have "proposed financial assistance of Rs. 2 billion ($15.5 million) to retailers in the form of corporate guarantees" in 2021.
The complaint alleges Pernod Ricard provided these guarantees in return for mandating that its brands comprise 35 percent of the stock on sale at the retailers' stores.
A regulatory order issued Friday by the Competition Commission of India (CCI) said it was ordering the investigation as "...vertical arrangements between Pernod Ricard and retailers is likely to result in distortion of demand by way of moving retail demand away from the competing brands to Pernod Ricard, artificially, thereby leading to a situation of driving existing competitors out of the market".
The antitrust watchdog said "such an action is likely to result in restriction of choice to end consumers rather than benefit them in any manner".
According to the CCI order, the allegations were made by an individual named Mohit, a resident of the western city of Jaipur.
"The market share of Pernod Ricard increased from 15 percent to 35 percent and it had planned to increase the same to 47 percent over a period of three years," after the proposed financial assistance, as per the complaint.
The case adds to challenges for Pernod Ricard in India, its largest market by sales volume.
A Pernod India office was raided in 2024 in a separate antitrust case. The company is also contesting a $250 million federal tax demand and faces another probe into alleged violations of New Delhi's liquor policy, which it denies.
(Agencies)