The aftermath of a CCI Raid: What happens if accusations against media agencies hold true?

On March 18, 2025, the Competition Commission of India (CCI) began conducting extensive raids on the offices of major global media agencies, including GroupM, Publicis, Dentsu, and Interpublic Group, as well as the Indian Broadcasting and Digital Foundation (IBDF). These actions were prompted by allegations of price collusion and ad rate fixing within the industry. 

The raids spanned multiple cities, including Mumbai, New Delhi, and Gurugram, and involved scrutiny of emails and other communications to uncover evidence of anti-competitive practices.

The timing of these raids was particularly significant, occurring just before the commencement of the Indian Premier League (IPL) cricket tournament, as it attracts massive advertising budgets across TV, digital, and sponsorships. Any disruption in media buying operations right before the tournament could impact negotiations, pricing, and ad inventory allocation. 

According to a Reuters report, Japan’s Dentsu was among the firms that applied for leniency. The investigation was linked to the CCI’s leniency program, which offers a full penalty waiver for the first company to disclose evidence of wrongdoing and reduced penalties for subsequent applicants.

The report further stated that Dentsu allegedly submitted its leniency application in February last year and reportedly provided evidence of pricing arrangements between the Advertising Agencies Association of India (AAAI) and IBDF, which set discounting terms for securing advertising clients.

Through conversations with industry experts, many of whom preferred to remain anonymous, it becomes evident that the potential fallout could reshape the industry's approach to transparency, pricing structures, and client-agency relationships.

A source said, “It’s evident that global agencies are realigning their priorities in response to changing market forces and increasing scrutiny. Regardless of the motivations behind any such move, the result is clear: advertisers are demanding greater transparency, ethical pricing, and measurable performance from their partners. A regulatory move like this can redefine the power structures within the Indian advertising landscape.”

If media agencies and broadcasters were engaging in price collusion, it could have inflated ad rates for brands looking to advertise during IPL, leading to unfair pricing. The CCI likely timed its action to prevent any potential impact on IPL ad rates.

These practices, if confirmed, could violate the Competition Act of 2002, which prohibits anti-competitive agreements and abuse of dominant positions.

An ex-employee of one of the raided media networks expressed deep disappointment, stating that it was disheartening to see the industry tainted by those driven by greed. They said, “Outdoor media was always ruled by goons, and we thought it would get cleaned up as the industry grew. Instead, it seems like the entire media industry is following the footsteps of unethical money-making practices.”

Such sentiments highlight a long-standing issue of opacity in media buying, where clients are often unaware of the actual costs, commissions, and rebates involved.

Legal consequences and regulatory crackdown

If the allegations of price-fixing and collusion are substantiated, agencies could face significant legal and financial consequences.

Competition Lawyer, and Managing Partner at Anupam Sanghi & Associates, Anupam Sanghi, outlined the potential penalties:

“If the Competition Commission of India (CCI) conclusively establishes that media agencies and broadcasters engaged in price-fixing, the implicated entities could face substantial financial penalties. According to the CCI’s 2024 guidelines, penalties for anti-competitive agreements can be as high as 10% of the average annual turnover over the preceding three years or three times the annual profits during the period of collusion, whichever is greater. For individuals found responsible, fines can reach up to 10% of their average annual income over the prior three years.”

She shared that beyond fines, executives found guilty could face personal liabilities, including bans from holding key positions in companies governed by competition law.

Sanghi also pointed out that similar investigations have led to substantial penalties in other industries, and in terms of cartelisation, the CCI has investigated a total of 35 cases in the past 5 years across a range of sectors. 

She said, “In terms of bid rigging, the CCI has investigated several cases, including landmark investigations in Ammonium Phosphate procurement (Excel Crop Care), coal liaisoning services (MAHAGENCO procurement), and cement procurement. Some of the early cartels found since 2012 are LPG Cartel, Cement Cartel, Beer Cartel, and Tyre Cartel fined 39 Crores, 6300 Crores, 873 Crores and 1788 Crores respectively.”

Given these precedents, if the CCI establishes wrongdoing, media agencies could face similar financial repercussions.

Impact on agency-client relationships

One of the biggest repercussions of these findings would be the erosion of trust between agencies and their clients. 

A source from an ad fraud detection firm said, “If these allegations hold true, brands will likely demand real-time verification, performance-linked pricing models, and greater auditing measures. This could lead to a shift towards AI-driven media planning and increased regulatory oversight.”

They added, “Agencies that proactively embrace transparency, accountability, and fair competition will likely emerge stronger, while those resistant to change may face challenges in retaining client trust.”

Echoing similar concerns, a digital agency founder pointed out how such practices could further disadvantage smaller players in an already competitive landscape. They said, “For smaller agencies and new entrants, such practices if they exist, will only make an already challenging market even more difficult to navigate. A level playing field is crucial for fostering true innovation and creativity.”

As scrutiny intensifies, agencies that fail to adapt to evolving expectations risk losing ground to in-house teams and technology-driven alternatives, altering the competitive landscape of the advertising sector.

Could this reshape advertising contracts?

A significant shift in advertising contracts is likely if price-fixing allegations hold. The industry may move towards stricter transparency clauses and more detailed pricing disclosures.

Sanghi explained, “Should the allegations be substantiated, there will likely be a heightened emphasis on transparency in pricing mechanisms. Advertisers may increasingly demand clear terms, including detailed discount structures and comprehensive reporting, to ensure adherence to competition laws.”

However, there is a counterargument. Sanghi noted that media agencies, unlike product sellers, offer services, making pricing comparisons challenging. She said, “Every agency has its own scale of pricing for different service packages. Can two doctors or hospitals be compared for what they offer? The allegation of cartelisation must specify the exact type of services under scrutiny.”

This raises concerns about how regulations should be implemented without creating an environment where competitors engage in tacit collusion, adjusting their pricing based on public knowledge rather than secret agreements.

As the investigation unfolds, the Indian advertising industry must decide whether to continue business as usual or use this moment as an opportunity to rebuild trust, fairness, and integrity in the ecosystem. The future of media buying and the agencies that drive it depends on it.

Disclaimer: We have reached out to dentsu for their official stance on the leniency petition and the ongoing investigation. If and when they respond, we will release their official statement.