Price-Fixing Circulars Amount to Cartelisation: CCI Holds Three Maharashtra Liquor Associations Guilty
Pranav B Prem
The Competition Commission of India (CCI) has held that three liquor merchants’ associations operating in Maharashtra engaged in cartelisation by issuing circulars prescribing prices, margins and other commercial terms, thereby illegally distorting competition in the liquor retail market. In an order dated December 11, 2025, the Commission ruled that such conduct squarely attracts the presumption of anti-competitive effect under Section 3(3) of the Competition Act, 2002.
The order was passed by a coram led by Chairperson Ravneet Kaur, along with Members Anil Agrawal, Sweta Kakkad and Deepak Anurag. The Commission observed that practices restricting independent business decision-making “lie at the core of Section 3 of the Act” and cannot be justified on grounds of convenience or industry practice.
The proceedings arose from a 2019 complaint filed by an alcoholic beverage manufacturer against the Maharashtra Wine Merchants Association, the Pune District Wine Merchants Association, and the Association of Progressive Liquor Vendors. The informant alleged that these associations were functioning as a cartel by dictating uniform retail margins, discounts, credit terms, transportation charges and mandatory “launch fees” for introducing new liquor products in the market.
Acting on the complaint, the CCI, by an order dated January 21, 2020, directed the Director General (DG) to conduct an investigation. In its investigation report submitted on July 29, 2022, the DG found that the associations had issued circulars and Letters of Introduction which effectively fixed prices and commercial terms, thereby restricting independent pricing decisions of retailers and manufacturers. The DG concluded that such conduct amounted to a violation of Section 3 of the Competition Act.
The associations denied any wrongdoing and contended that they were merely representative bodies acting in the interest of small retailers. They argued that the circulars and letters issued were non-binding, pro-competitive and part of long-standing industry practice. It was further submitted that the liquor sector is heavily regulated under state excise policies, leaving limited scope for independent pricing.
Rejecting these submissions, the Commission held that decisions taken by associations of enterprises engaged in identical trade fall squarely within the ambit of Section 3(3). The CCI noted that the requirement for manufacturers to obtain mandatory no-objection certificates from associations before launching products, coupled with the prescription of uniform margins and schemes, effectively eliminated independent commercial decision-making.
The Commission observed that practices facilitating coordination among competitors or imposing uniform trading conditions cannot be defended under the guise of efficiency enhancement or market facilitation. It held that such conduct, by its very nature, restricts competition on price and terms of trade, which lies at the heart of the prohibition under Section 3 of the Act.
The CCI further emphasised that while trade associations may legitimately represent the interests of their members, they cannot assume the role of determining commercial terms. It clarified that adjustments to margins in response to market or fiscal changes are commercial matters to be decided bilaterally between manufacturers and individual retailers, and not collectively enforced through associations.
In addition to holding the associations liable, the Commission also found several office bearers personally liable under Section 48 of the Competition Act, observing that they were in charge of and responsible for the conduct of the associations during the relevant period. However, taking note of the fact that the associations were first-time offenders and had undertaken to discontinue the impugned practices, the CCI refrained from imposing monetary penalties. Instead, it directed the associations and their office bearers to cease and desist from such conduct and cautioned that any future violations would attract serious consequences under the law.
Appearance
For Opposite Party No. 1: Advocates Anandh Venkataramani, Anjali Agrawal
For Opposite Party No. 2: Advocate Gauri Puri
For Opposite Party No. 3: Advocate Manu Chaturvedi
Cause Title: XYZ (Confidential) vs Maharashtra Wine Merchants Association, Pune District Wine Merchants Association, Association of Progressive Liquor Vendors, Pimpri Chinchwad Liquor Dealers Association.
Case No: 43 of 2019
Coram: Chairperson Ravneet Kaur, Members- Anil Agrawal, Sweta Kakkad, Deepak Anurag
