India’s antitrust regulator launched an investigation against Google for allegedly abusing its dominant position to force app makers to exclusively use its billing system for in-app purchases and for bundling the search giant’s payments app. with Android smartphones sold domestically.
While the Competition Commission of India (ITC) received complaints against Google on six counts, it has chosen to investigate just two for violations of antitrust rules. On the other four counts, the commission said the plaintiff has not provided sufficient evidence to launch an investigation.
The two questions, which the CCI is investigating, refer to “exclusivity in terms of the form of payment for the purchase of applications and in-app purchases” and “pre-installation and prominence of Google Pay on Android smartphones.”
The ICC said the complaints were related to search rigging to favor Google Pay; Google Pay prominent location in Play Store; the manipulation of search ads in the Play Store and the exclusivity requirements imposed by Google did not merit investigation.
The regulator’s investigation follows complaints by Indian startups against Google’s policy, which requires apps to mandatorily use Google’s payment tools to sell services through the Play Store.
While the complaints focus on Google Pay, their outcome could have a broader impact on how the company enforces its Play Store rules in India.
If CCI concludes that Google has indeed violated the rules, it would be a shot in the arm for Indian startups, who have been protesting the Play Store’s decision to charge a 30% commission for in-app sales.
Startup founders, including Paytm’s Vijay Shekhar Sharma and Razorpay’s Harshil Mathur, have criticized Google for forcing app makers to use their own payment tools for purchases made through the Play Store.
Kanika Chaudhary Nayar, a partner at L&L Partners, said CCI has the power to penalize Google based on the average of its relevant business volume over the past three years. This is similar to ₹A fine of 135.86 crore imposed on the tech giant in 2018 for abusing its domain in Internet searches.
Nayar also said that while CCI has the power to divide Google and ban Google Pay from being included on Android phones, the regulator has not exercised power despite the law having been in place for more than 11 years.
Google said in a statement: “We are pleased that the ICC has rejected several claims made by the anonymous whistleblower. Regarding the remaining concerns, first and foremost, we trust that ITC will find GPay operating in an extremely competitive environment and owes its success to its ability to offer consumers a simple and secure payment experience.
Second, there are numerous distribution channels for applications on the Android platform; Play is not the only application distribution option for Android. Users choose Google Play because we guarantee a safe and smooth experience. Play’s billing system is a critical part of meeting this user’s expectations and helps ensure our continued investment in the many important things necessary for developers to be successful. “
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