by Aditya Kalra and Arpan Chaturvedi
NEW DELHI (Reuters) – An internal investigation by Pernod Ricard concluded that executives at its Indian subsidiary had violated an alcohol policy by financially supporting distributors in New Delhi, a document seen by Reuters showed.
The Pernod Ricard India group had previously strongly denied these allegations.
The Enforcement Directorate, an Indian judicial body, had accused Pernod Ricard India of money laundering in January 2023, estimating that the group had illegally provided corporate guarantees amounting to $24 million to help certain retailers finance their calls for tenders with a view to obtaining a license.
The body had also said that Pernod Ricard India provided corporate guarantees to its banker HSBC in 2021 before asking it to facilitate the provision of loans to distributors, who used the funds for obtaining store licenses of alcohol sales in New Delhi.
New Delhi government policy prohibits liquor groups from participating in the distribution of their products, directly or indirectly.
A draft report prepared by law firm Shardul Amarchand Mangaldas at the request of Pernod Ricard India indicates that three managers of the subsidiary of the French spirits group “acted in violation of the (Delhi excise policy)”.
“Some conversations indicate that the corporate guarantee was a way to control market share through retail,” the report said.
“Their behavior also suggests a broader conspiracy between (the employees) and other industry players,” the report added, which could have implications for Pernod in legal proceedings.
A person with direct knowledge of the matter said the conclusions of the draft report were identical to those in the final document sent to Pernod Ricard headquarters in Paris a few weeks after it was written.
Contacted by Reuters, Pernod Ricard India denied “any wrongdoing by (the company) or its directors”, adding “we have always collaborated with the relevant authorities and have confidence in the legal process”.
A spokesman for Pernod Ricard in Paris did not respond to questions from Reuters. The Enforcement Directorate did not respond to a request for comment.
( Camille Raynaud)
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