An internal investigation ordered by French spirits giant Pernod Ricard has reportedly (via Reuters) found that top executives of its Indian unit violated laws by collaborating with alcohol retailers in New Delhi, even as the company publicly denies any wrongdoing. This comes amid ongoing scrutiny by Indian authorities.
Accusations against Pernod Ricard India
India’s Enforcement Directorate (ED) alleged in January 2023 that Pernod Ricard India (PRI) engaged in money laundering by unlawfully providing $24 million in corporate guarantees to help retailers fund license bids. This was allegedly done in exchange for prioritizing Pernod’s brands in their stock.
The company also reportedly lobbied for a 2021 policy in New Delhi that allowed private retailers to operate liquor shops, moving away from a government-run model.
Findings of internal investigation
A draft report in May 2023, prepared by Indian law firm Shardul Amarchand Mangaldas, showed that three senior executives, including the then-Chief Operating Officer Rajesh Mishra, violated Delhi’s excise policy. The policy prohibited manufacturers from investing in retail operations (via Reuters).
- Corporate guarantees: The report indicated that the guarantees were used to exert retail control and secure market share for Pernod’s products.
- Conspiracy allegations: The findings suggested a broader conspiracy involving Pernod employees and other industry players.
- Inaccurate testimony: The report noted that Mishra provided “factually inaccurate” statements to federal agents during questioning.
The conclusions in the draft report are reportedly consistent with the final version submitted to Pernod Ricard’s Paris headquarters.
Pernod Ricard’s response
Pernod Ricard India has denied any wrongdoing by the company or its executives in relation to the allegations, according to Reuters.
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