India’s competition watchdog investigates the state’s beer retailer TASMAC over alleged malpractice

India’s fair-trade regulator, the Competition Commission of India (CCI), has ordered an investigation into the state-owned liquor retailer Tamil Nadu State Marketing Corporation Ltd (TASMAC) following allegations that it is restricting competition in the state’s beer market by favouring select brands. TASMAC is company wholly owned by the Tamil Nadu government and registered under the Companies Act. Tamil Nadu state is home to a number of large cities such as Chennai, Coimbatore and Madurai.

On 25 March 2025, the CCI issued an order for an investigation report to be completed and submitted within 60 days, following an individual filing a complaint alleging that TASMAC has been purchasing and selling only a limited range of beer brands, while curtailing access to other brands in the market thus discouraging competition.

The complainant argued that this practice violates Section 4 of the Competition Act, 2002, which prohibits abuse of dominant position. TASMAC has exclusive rights to sell alcoholic beverages in Tamil Nadu through its 5,000-plus retail outlets. Moreover, it was also alleged that TASMAC had formed a nexus with specific breweries with the intent of restricting consumer choice and impeding fair competition, according to the order.

TASMAC has disputed the allegations, claiming that its procurement process is automated and based on a weighted average sales calculation method. The orders for beer manufacturers are generated through a software at the beginning of each month and take into account past sales and existing stock levels. The stocking choices of particular brands by TASMAC, therefore, are dependent on consumer preferences and also manufacturers’ ability to meet demand.

The Commission, however, remains unconvinced. “In consideration of the facts and circumstances of the present case, the Commission is of the prima facie view that TASMAC appears to be abusing its dominant position by limiting market access to certain brands of beer in the state of Tamil Nadu in contravention of Section 4(2)(c) of the Act,” says the CCI order. “On the basis of the material available on record, there appears to be substance in the allegations levelled by the Informant and the same merits investigation,” the order said.