CCI Slaps Rs 936 Crore Fine on Google for Play Store Policies, Its Second Penalty in A Week

Holding that Google abused its dominant position with respect to its Play Store policies, the Competition Commission of India has imposed a fine of Rs. 936.44 crore on the tech giant.

Google has been given 30 days to provide the requisite financial details and supporting documents.

The commission found that Google is in a dominant position in the licensable OS for smart mobile devices and app stores for the Android smart mobile OS market and has reaped the benefit of indirect network effects.

“The app stores have become a necessary medium for the distribution of applications to the end users and the availability of app store(s) is directly dependent on OS installed on a smart device,” the order passed by CCI stated.

The commission noted that the Play Store policies require app developers to exclusively and mandatorily use Google Play Billing System (GPBS). Such a billing system is deployed not only for purchasing the app but also for the in-app purchases within and the developers cannot provide a separate link to a webpage for the payments for in-app purchases, it stated.

Terming such practice arbitrary and devoid of any legitimate interest of business, the commission observed that if app developers did not comply with Google’s policies, they were not allowed to list their apps on the play store, which resulted in losing a vast pool of customers in the form of Android users.

Also, the commission examined the allegations of exclusion of rival UPI apps as effective payment options on the Play Store.

Stating that the intent flow technology is superior and more user-friendly than collect flow technology, by offering significant advantages to both customers and merchants and the success rate being higher due to lower latency, the commission found that Google Pay has been integrated with intent flow methodology whereas other UPI apps can be used through collect flow methodology.

Google informed the commission that it recently changed its policy and allowed rival UPI apps to be integrated with intent flow.

The CCI, however, concluded that mandatory use of GPBS for app purchases and in-app purchases constitutes an imposition of unfair conditions on app developers as it results in the denial of market access for payment aggregators and app developers.

Thus, the commission passed the order directing that Google should not restrict app developers from using third-party billing processing services for app purchases and in-app purchases.

Google shall not impose any anti-steering provisions on app developers and shall not restrict them from communicating with their users to promote their apps and offerings, in any manner, the CCI ordered.

It further ordered that Google shall not restrict end users, in any manner, to access and use within apps, the features, and services offered by app developers and it shall formulate a policy on data collected from its platform and will share such data with app developers and related entities.

Google has further been restricted from ‘imposing’ any condition (including price-related conditions) on app developers, which is unfair, unreasonable, discriminatory, or disproportionate to the services provided to the app developers and ‘discriminating’ against other apps facilitating payment through UPI in India vis-à-vis its own UPI app, in any manner.

Last week, CCI imposed a fine of Rs. 1,300 crore on Google for abusing its dominant position in multiple markets in the Android mobile device ecosystem.

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