CCI Finds Maharashtra Liquor Retail Associations Guilty Of Cartelisation, Issues Cease-And-Desist Order

On 11 December 2025, the CCI found the Maharashtra Wine Merchants Association, the Pune District Wine Merchants Association, and the Association of Progressive Liquor Vendors (collectively the Associations) in contravention of Section 3(3)(a) and 3(3)(b) of the Competition Act. The case originated from a complaint filed by a beverage manufacturer (identity kept confidential), which alleged that these Maharashtra liquor retail associations had, since 2014, collectively imposed uniform margins, discounts, credit terms, transport charges and mandatory “launching fees” on manufacturers and distributors. The Informant also alleged that manufacturers were required to obtain Letters of Introduction (LOI) and No Objection Certificates(NOC) from the Associations before launching any new product, and that attempts to deal directly with retailers were met with coordinated boycotts.

Pursuant to the complaint, the CCI had ordered the Director General CCI (DG) to investigate the allegations in January 2020. Following an extensive investigation, the DG concluded that the Associations had engaged in anti-competitive conduct by issuing circulars and communications prescribing uniform margins, discounts, payment terms, and transportation charges, thereby amounting to price-fixing under Section 3(3)(a) of the Competition Act. The DG further found that the requirement imposed on manufacturers to obtain LOIs/NOCs prior to launching new products functioned as an approval mechanism for market entry and violated Section 3(3)(b) of the Competition Act. Six office bearers of the associations were also identified as being liable under Section 48 of the Competition Act for having been in charge of and responsible for the conduct of the associations.

In response to the DG’s findings, the Associations argued that they were merely representative bodies not engaged in trade, that LOIs were non-binding and pro-competitive, and that liquor pricing in Maharashtra was already regulated by the State Excise laws. They further contended that there was no evidence of boycott, coercion, or restriction of supply, and that the DG had relied on inadmissible or hearsay evidence. The associations also urged that, in any event, no penalty should be imposed given their non-profit nature, first-time contravention, and the potential impact on small retailers.

The CCI rejected the Associations’ submissions and, relying on emails, circulars, LOIs, NOCs and witness testimony, held that the LOI/NOC mechanism operated as a coordinated system for fixing and enforcing uniform commercial terms, eliminating independent pricing by manufacturers and retailers.

The CCI further held that such coordinated determination of margins and launch conditions is presumed to cause an AAEC in terms of Section 3(3) of the Competition Act, and cannot be justified on grounds of industry practice or protection of small retailers. The CCI reiterated that trade associations cannot be used as a platform for coordination amongst competitors.

Thus, the CCI upheld the DG’s findings against the Associations and held their office bearers liable under Section 48 of the Competition Act.  However, considering mitigating factors such as first-time contravention, non-commercial character of the associations, discontinuation of the LOI practice, and absence of evidence of personal gain by office bearers, the CCI ultimately refrained from imposing any monetary fines.

Business Takeaway: Industry bodies must avoid any role in setting or enforcing prices, margins, discounts, or launch conditions. Tools presented as “industry practices” (such as LOIs, NOCs or coordination through meetings and messages) can expose both the association and its office bearers to cartel liability. Personal liability and penalties remain real risks even where the association is non-profit.