New Delhi, May 9 (IANS) The Competition Commission of India (CCI) has ordered a detailed antitrust investigation into French liquor group Pernod Ricard over allegations that the liquor major entered into exclusive arrangements with retailers in Delhi to promote its brands and restrict rival products in the market.

The fair trade regulator said it found prima facie merit in allegations that Pernod Ricard and associated entities may have engaged in ‘exclusive dealing agreements’ aimed at increasing the company’s market share in Delhi’s Indian Made Foreign Liquor (IMFL) segment.

The CCI order referred to allegations related to bid rigging in tenders issued by the Delhi Excise Department for wholesale supply of country liquor in 2022-23.

The complainant alleged that two bidders had disclosed their financial quotes during the tender process, an act viewed as a collusive practice and a violation of tender norms.

The Excise Department subsequently cancelled the tender and ordered a fresh bidding process.

According to the CCI order, the company allegedly extended corporate guarantees worth about Rs 200 crore (around 23 million euros) in 2021 to support liquor retailers seeking bank loans and licences under Delhi’s excise policy framework.

The complaint claimed that retailers receiving such financial support were encouraged to allocate a substantial portion of shelf space and stock to Pernod Ricard brands, including Chivas Regal and Absolut Vodka.

“The non-dealing in the product of the competitors is likely to result in distortion of demand by way of moving retail demand away from the competing brands,” the CCI said in its order.

The regulator also observed that such practices could potentially restrict consumer choice and adversely impact fair competition in the retail liquor market.

The order further referred to internal company communications in which executives allegedly discussed obtaining a “strategic advantage” across liquor retail zones in Delhi by extending financial support to retailers bidding for licences.

Moreover, the CCI has directed its Director General (DG) to conduct a detailed probe into the matter and submit a report within 90 days.

The order noted that allegations of bid rigging were examined in relation to three tenders floated by Delhi’s Excise Department for wholesale country liquor supply in 2022-23.

While the first two tenders were cancelled over alleged disclosure of financial quotes and suspected pool formation among bidders, only the third tender issued in January 2023 was ultimately awarded.

Additionally, the regulator clarified that only certain entities, including Pernod Ricard, Indo Spirits, Pathway HR Solutions, Universal Distributors, Khao Gali, Bubbly Beverages, Shiv Associates and Organomix Ecosystems, would remain part of the investigation, while allegations against several other parties were not substantiated.

–IANS

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