After Apple was fined $38 billion, a French wine and spirits giant fell into the same trap and was fined $600 million by India.

By Wang Xinxǐ Following Apple’s $38 billion fine, it is now the turn of the French wine and spirits giant. After turning India into its largest single market globally, the ‘pig-slaughtering scheme’—a term referring to sudden, heavy regulatory penalties—has finally landed on Pernod Ricard, the French酒业 giant behind Chivas Regal, Absolut Vodka, Royal Salute, and The Glenlivet. According to documents filed with the Delhi High Court and disclosed at the end of May 2026, Indian tax authorities have demanded that the company pay approximately $314 million (nearly ₹30 billion) in unpaid import duties. Should Pernod Ricard lose the case, the total penalty could exceed $600 million. This amount is roughly triple Pernod Ricard’s annual profit. Moreover, India has recently launched an antitrust investigation against the spirits giant. Given Apple’s $38 billion antitrust fine in India, Pernod Ricard’s $600 million penalty may only be the beginning—the prospect of even larger fines looms ahead. Pernod Ricard’s trouble was sown over a decade ago. India is a country with high tariffs and a complex, burdensome tax regime. Multinational corporations entering India often resort to related-party transactions to minimize tax liabilities. Domestic Indian distillation techniques lag behind, and low-end alcoholic beverages suffer from poor quality; consequently, the premium consumption segment is entirely dominated by imported whiskies. To protect its domestic liquor industry, India imposes among the world’s highest punitive tariffs on imported distilled spirits—up to 150%. As a result, importing finished products fully compliant with tariff obligations yields virtually no profit after factoring in duties and other costs. All foreign spirits companies—including Pernod Ricard and Diageo—adopt a uniform model in India: importing semi-finished products for local bottling. Specifically, they import whisky concentrates (‘new make spirit’ or bulk concentrate) from their overseas parent factories, then blend, bottle, and sell them in India. This model is legally permissible. However, Pernod Ricard’s Indian subsidiary purchases whisky concentrates from its UK subsidiary at transfer prices set entirely internally. According to Indian authorities, the company used internal codes to describe the age, malt type, maturation process, and quality grade of imported concentrates—making subsequent verification and evidence collection extremely difficult for Indian regulators. Investigations found that Pernod Ricard’s declared import prices were 67.5% lower than fair market value. The lower the declared import value, the less duty payable. Thus, the $600 million penalty comprises unpaid duties accrued over more than a decade, plus interest and penalties for violations. Clearly, India had been keeping meticulous records—and waited until the time was right to levy a massive fine. As early as 2022, Reuters reported that Indian customs had issued Pernod Ricard a tax warning totaling approximately $244 million. At the time, Pernod Ricard announced it would halt all new investments in India and directly addressed a letter to Prime Minister Modi via media channels, warning that ongoing tax disputes were impeding further investment. Thereafter, not until the second half of 2025 did Indian investigative agencies conclude—in September of that year—that Pernod Ricard had “deliberately complicated” its reporting information. A government court filing dated January 24, 2026, further accused the company of failing to disclose the age, composition, and specific ingredients of bulk Scotch whisky concentrate imported from its UK subsidiary, Chivas Brothers. Pernod Ricard is alleged to have undervalued these imported concentrates by approximately 67.49%.

Yunjiu Morning Brief: Zhijiang and Niqiang report revenue growth in H1; 'Aogong Jiu' lacks Jia Pingwa’s authorization.

Recently, several non-listed liquor enterprises disclosed their operating performance for the first half of 2026. Among them, Zhijiang Liquor Co., Ltd. reported a 6.9% year-on-year increase in sales revenue; Niqiang Liquor Co., Ltd. achieved growth in sales revenue and a 53.3% year-on-year rise in taxes and profits. Both enterprises recorded growth in certain operational metrics amid the ongoing industry adjustment period. (Zhijiang Liquor, Niqiang Liquor) ▎ 'Aogong Jiu' Has Not Obtained Jia Pingwa’s Authorization On August 16, Shandong Yanghu Liquor Co., Ltd. and Xi’an Qujiang Aoa Culture Communication Co., Ltd. jointly issued a statement declaring that the 'Aogong Jiu' project has not received any commercial authorization from author Jia Pingwa. Mr. Jia Pingwa has never participated in this project in any capacity—including licensing, calligraphic inscription, endorsement, equity investment, or collaboration. All online claims to the contrary are false. The brand name, logo design, cultural positioning, and product concepts of 'Aogong Jiu' were independently developed and are operated autonomously by the two companies. In response to fabricated, reposted, and disseminated false information, both companies have engaged legal counsel to conduct comprehensive online evidence preservation and will file civil lawsuits to claim damages; cases involving suspected criminal activity will be reported to competent authorities. (Jiemian News) ▎ Chengdu Municipal Bureau of Economy and Informatization Holds Special Meeting on Liquor Industry On August 13, the Chengdu Municipal Bureau of Economy and Informatization convened a special meeting on the liquor industry. Representatives from departments in the Qionglai production zone and key liquor enterprises—including Shuijingfang and Wenjun—attended. The meeting heard reports on operations and development proposals from five key enterprises, exchanged views on industry trends, brand building, and market expansion, and outlined key tasks for the next phase—including category innovation, cultural empowerment, and international expansion. (Chengdu Municipal Bureau of Economy and Informatization) ▎ Liquor Prices Down 2.7% Year-on-Year from January to July On August 9, the National Bureau of Statistics released data on consumer prices. In July, China’s national consumer price index (CPI) rose 0.5% year-on-year and fell 0.1% month-on-month; food, tobacco, alcohol, and dining-out prices declined 0.8% year-on-year and remained unchanged month-on-month. Among them, liquor prices dropped 3.0% year-on-year and fell 0.2% month-on-month; from January to July, liquor prices declined 2.7% year-on-year.

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