The Competition Commission of India (CCI) has been directed to investigate the complaints made by the Alliance of Digital India Foundation (ADIF). The three applications filed by the ADIF were against Google’s user choice billing system (UCB), set to go into effect on April 26. Under the new payment policy, app developers need to pay a commission of 11-26% for in-app purchases to Google.
In this regard, the Delhi High Court set the deadline of April 26 for the CCI to look into the complaints – a decision that will undoubtedly be lauded by digital startups in the world’s second-largest internet market and one of Google’s key markets. The complaints in question have been filed by the ADIF with India’s competition watchdog.
“…there is no impediment, whether legal or otherwise, in directing the CCI to hear the applications filed by the petitioner under section 42 and decide it on or before April 26,” Justice Tushar Gedela informed on Monday, April 24. “It is made clear that observations made herein are only to the extent of deciding the present list before this court and shall not tantamount to any expression on the merits of the case and the same is therefore without prejudice to the rights and contentions of all parties to be taken at the appropriate proceeding,” the single-judge bench added.
This development comes after the ADIF – a three-year-old industry body comprising Indian startups, such as Paytm, Matrimony, MapmyIndia, and TrulyMadly – sought directions from the Delhi HC to the competition regulator to invoke the “Doctrine of Necessity” to consider its applications. At that time, the ADIF also urged the CCI to put a halt to the new UCB system from kicking off until the investigation by the CCI into Google’s alleged non-compliance has been completed. Gedela, however, did not pass any stay on the implementation of UCB on Monday.
The industry body alleged that Google was engaging in anti-competitive practices by implementing the new payment policy, adding that it violates the order given by the Indian anti-trust watchdog on October 25, 2022. At that time, the CCI imposed a hefty fine on Google for abusing its dominant position in the Indian market. Additionally, it directed the company to cease restricting app developers from using third-party billing or payment processing services to purchase apps or for in-app billing on Google Play.
The UCB system replaces the prior GPBS, under which Google made it mandatory for all in-app purchases to go through its payment gateway (thereby negating the option of third-party payment systems) and that a steep commission will be charged on such purchases. Charging commissions on in-app purchases and prohibiting developers from enabling third-party payment systems have been a staple method of Google and Apple alike – something that has earned a lot of criticism from multiple quarters and forced the tech titans to make compromises on the matter.
