CCI raids GroupM, Dentsu and broadcasters’ body over price collusion: Sources

The CCI is investigating claims that these advertising agencies colluded with certain broadcasters to fix ad rates and negotiate discounts while selling to their clients, claims report.

India’s Competition Commission of India (CCI) has launched a major investigation, conducting raids on the offices of global advertising giants GroupM, Dentsu, and Interpublic Group, along with a broadcasters’ industry association, over allegations of price collusion, according to the Reuter report.

The CCI officers searched around 10 locations in Mumbai, New Delhi, and Gurugram after initiating a case against the advertising agencies and top broadcasters. The case revolves around alleged manipulation of advertising rates and discounts.

Allegations Of Collusion

The CCI is investigating claims that these advertising agencies colluded with certain broadcasters to fix ad rates and negotiate discounts while selling to their clients. These practices, if proven, could have distorted the competitive landscape in India’s advertising market.

In such surprise raids, CCI officers typically seize relevant documents and record statements from company officials. The investigation process is confidential and may take several months to complete.

In December, the CCI raided some offices of alcohol giants Pernod Ricard and Anheuser-Busch InBev as it investigated accusations of price collusion with retailers in a southern state. The Indian Broadcasting foundation represents top domestic broadcasters, including billionaire Mukesh Ambani’s Reliance-Disney joint venture.

The raids occur against the backdrop of significant changes in India’s advertising industry, particularly after the $8.5 billion merger between Walt Disney and Reliance’s Indian media assets. 

The CCI’s action shows its focus on ensuring fair competition in India’s growing advertising and media sectors.

(With Inputs From Reuters)