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

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. If it loses the case, the total penalty could exceed $600 million. This amount is roughly three times Pernod Ricard’s annual profit for that year. Moreover, India has recently launched an antitrust investigation against the spirits giant. Given Apple’s $38 billion antitrust fine in India, once Pernod Ricard pays this $600 million penalty, even larger fines may still be looming. Pernod Ricard’s troubles were sown over a decade ago. India is a country with high tariffs and a complex tax regime. Multinational corporations entering India often resort to related-party transactions to reduce tax liabilities. Domestic Indian distillation technology lags, and low-end alcoholic beverages suffer from poor quality; thus, the premium segment is entirely dominated by imported whiskies. To protect its domestic liquor industry, India imposes among the world’s highest punitive tariffs on imported spirits—up to 150%. As a result, importing finished products fully compliant with tariff obligations leaves virtually no room for profit after factoring in duties and costs. All foreign liquor companies—including Pernod Ricard and Diageo—adopt a uniform model in India: importing semi-finished products and bottling them locally. Specifically, they import whisky concentrate (‘new make spirit’ or ‘cask strength concentrate’) from their overseas parent factories, then blend, bottle, and sell in India. This model is legal per se. However, Pernod Ricard’s Indian subsidiary purchases whisky concentrate from its UK subsidiary at transfer prices set entirely at its own discretion. According to Indian authorities, the company used internal codes instead of disclosing the actual age, malt type, maturation process, and quality grade of the imported concentrates. During subsequent verification and evidence collection, Indian officials found that Pernod Ricard’s declared import value was 67.5% lower than the fair market price. The lower the declared import value, the less duty payable. Hence, 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 for the right moment 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 even sent a direct open letter to Prime Minister Modi via media outlets, warning that ongoing tax disputes were deterring fresh investment. Thereafter, until the second half of 2025, Indian investigative agencies concluded in September that Pernod Ricard had “deliberately complicated” its reporting information. A government court filing dated January 24, 2026 further alleged that, when importing bulk Scotch whisky concentrate from its UK subsidiary Chivas Brothers, the company failed to truthfully disclose the imported product’s age, composition, and specific ingredients. Pernod Ricard is accused of undervaluing these imported concentrates by approximately 67.49%.

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However, according to unnamed officials involved in the raids, the Competition Commission of India (CCI) is investigating how international advertising giants allegedly colluded with certain Indian broadcasters to fix advertising rates while selling ads to clients—and engaged in collective action to avoid offering discounts on ad rates. During such raids, CCI officials typically seize documents and record testimonies from company executives. The investigation may then continue for several months, and the entire process remains confidential. If found guilty, media firms could face fines up to three times their profits—i.e., triple the profit earned annually during the period of collusion—or 10% of their annual turnover for each year of misconduct, whichever is higher. II. India’s status as a top growth market has drawn fierce competition from global advertising giants—and attracted the equally keen gaze of Indian regulators. Over the past decade, as multinational corporations have shifted investment risks and restructured global supply chains, India—with its vast labor force and low labor costs—has attracted substantial foreign investment, becoming one of Asia’s—and indeed the world’s—fastest-growing economies. With rapid economic expansion, India’s advertising market has also grown swiftly. According to GroupM, India ranks as the world’s eighth-largest advertising market, generating $18.5 billion in revenue in 2024 and projected to grow by 9.4% to exceed $20 billion in 2025. This rapidly expanding market has triggered intense competition among global advertising giants operating in India. GroupM notes that India is becoming the fastest-growing advertising market globally, with digital advertising accounting for 60% of total ad spend. Streaming giants like JioHotstar, Netflix, and Amazon Prime—as well as online platforms like YouTube—are extremely popular in India. III. Regulatory reform has become an urgent priority in India. On the surface, the CCI’s raids on global advertising giants operating in India signal that Indian regulators are closely monitoring major industries and taking steps to ensure fair competition and prevent market manipulation in India’s rapidly growing advertising and media sector. In reality, however, India suffers from excessive regulation, overly complex and ambiguous regulatory laws, and broad, arbitrary interpretive powers vested in regulatory agencies—problems that severely trouble foreign enterprises operating in India. For instance, in October 2023, India’s anti-money laundering agency arrested a Chinese employee of smartphone manufacturer Vivo at its office near New Delhi and conducted a surprise raid on Vivo’s office in Greater Noida, Uttar Pradesh, accusing the company of illegally transferring funds from India to China. The Enforcement Directorate also accused Vivo of evading customs duties. According to a report by China Daily on October 1, 2023, Indian officials did not even bother to present any evidence supporting their allegations against Vivo—making the arrest all the more puzzling. China Daily reported that on September 28, 2023, Indian income tax officials raided Lenovo’s offices in Mumbai, Bengaluru, and two other cities, launching an investigation into the Chinese laptop manufacturer. In April 2022, Indian tax authorities froze Xiaomi’s assets worth $676 million—again without presenting any substantive evidence to support their allegations.

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