Play Store policies: CCI slaps Rs 936.44 cr fine on Google for abusing dominance

In its second ruling against Google in less than a week, the Competition Commission on Tuesday slapped a penalty of Rs 936.44 crore on the internet major for abusing its dominant position with respect to its Play Store policies.

The regulator has also directed the company to cease and desist from unfair business practices as well as carry out various measures to address the anti-competitive issues within a defined timeline. This is the second major CCI ruling against Google in less than a week. On October 20, the watchdog imposed a penalty of Rs 1,337.76 crore on the company for abusing its dominant position in multiple markets in relation to Android mobile devices and ordered the internet major to cease and desist from various unfair business practices.

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In a release on Tuesday, the Competition Commission of India (Commission) said it has imposed a penalty of Rs 936.44 crore on Google for abusing its dominant position with respect to its Play Store policies. Google’s Play Store constitutes the main distribution channel for app developers in the Android mobile ecosystem, which allows its owners to capitalise on the apps brought to market.

The regulator noted that making access to the Play Store for app developers dependent on mandatory usage of GPBS (Google Play’s Billing System) for paid apps and in-app purchases constitutes an imposition of an unfair condition on app developers. Apart from the penalty, CCI said Google should not restrict app developers from using any third-party billing/ payment processing services for purchasing apps.

There was no immediate comment from Google on the latest CCI order. On October 21, Google said it will review the order with respect to the Android devices matter. Similar to the observations made in its ruling against Google in the Android matter, CCI on Tuesday said the penalty amount is provisional as there were glaring inconsistencies and wide disclaimers in presenting various revenue data points by Google.

The penalty amount translates to 7 per cent of the company’s average relevant turnover. Google has been given a time of 30 days to provide the requisite financial details and supporting documents, the release said. The regulator has been probing Google in other cases as well, including those pertaining to alleged anti-competitive practices by the internet major with respect to news content and smart TV.

In February 2018, the regulator imposed a fine of Rs 136 crore on Google for unfair business practices in the Indian market for the online search. According to the release on Tuesday, Google has been asked to implement various measures, including allowing and not restricting app developers from using any third-party billing/ payment processing services, either for in-app purchases or for purchasing apps.

“Google shall also not discriminate or otherwise take any adverse measures against such apps using third-party billing/ payment processing services, in any manner,” the release said. Further, the internet major has been asked not to impose any anti-steering provisions on app developers as well as not restrict them from communicating with their users to promote their apps and offerings, in any manner.

Google should not restrict end users, in any manner, to access and use within apps, the features and services offered by app developers, the release said. According to CCI, the company should set out a clear and transparent policy on data that is collected on its platform, the use of such data by the platform and also the potential and actual sharing of such data with app developers or other entities, including related entities.

Among other directions, the regulator has told Google that the competitively relevant transaction/ consumer data of apps generated and acquired through GPBS should not be leveraged by the company to further its competitive advantage. “Google shall also provide access to the app developer of the data that has been generated through the concerned app, subject to adequate safeguards, as highlighted in this order,” the release said.

Also, CCI has asked the internet major not to impose any condition on app developers, which is unfair, unreasonable, discriminatory or disproportionate to the services provided to them. As per the regulator, Google should ensure complete transparency in communicating to app developers, services provided, and the corresponding fee charged. Google shall also publish in an unambiguous manner the payment policy and criteria for the applicability of the fee.

“Google shall not discriminate against other apps facilitating payment through UPI in India vis-a-vis its own UPI app, in any manner,” it added. Meanwhile, the watchdog said that recently Google has allowed rival UPI apps to be integrated with the intent flow.