Google refused to be granted interim suspension of CCI fine by NCLAT

In a setback for Google, an appeals court on Wednesday denied an interim stay to the competition regulator imposing a Rs. 936 crore fine on the US tech giant for abusing its dominant market position.

The National Company Law Appeal Tribunal has ordered Google to drop 10% of the fine imposed by India’s Competition Commission in a case related to its Play Store policies.

A week ago, Google failed to secure relief from the NCLAT on a separate Rs. Fine of 1,337.76 crores imposed by the ICC for alleged abuse of the dominant position of the American technology giant in the operating system of Android smartphones in the country. He was asked to deposit 10% of the fine within four weeks.

Google challenged that order in the Supreme Court, which agreed to hear it on Monday.

While in the first case, CCI asked Google last October to allow smartphone users on the Android platform to uninstall apps and let them select a search engine of their choice, the regulator said that the company needed to take corrective action on policies that forced developers to use Google Play’s billing system to list their apps on its Play Store.

A two-member NCLAT bench comprising Justice Rakesh Kumar and Alok Srivastava issued notices to the ICC on Wednesday and released the case for hearing on April 17, 2023.

A letter sent to Google for comment did not elicit a response.

Lead attorney Harish Salve said the US company appealed the Play Store and Android decisions because the Commission failed to consider the negative impacts on users, developers and manufacturers.

Google will, during the hearings before the NCLAT, strive to establish that the CCU’s orientations jeopardize the technology, security and choice offered by Play and Android.

It will also seek to establish that the Commission failed to take into account the benefits of Play and Android for Indian end-users, including benefits such as mobile access (and hence the continued the goal of increasing teledensity, which is central to the push for Digital India) as well as protecting end users from malware and abusive billing practices.

Google’s business model for its Play Store is tied to the business model of app developers. When app developers distribute their apps for free, there are no fees. When app developers sell their apps or sell in-app digital content to end users, Google collects service fees.

According to Google, this was done for technical, security, and business reasons.

On October 25, CCI imposed a fine of Rs 936.44 crore on Google for abusing its dominance over its Play Store policies. The regulator had also ordered the company to cease and desist from unfair business practices as well as take various actions to address anti-competitive issues within a set time frame.

Google later said it was “pausing” enforcement of the requirement for developers to use Play’s billing system for the purchase of digital goods and services for user transactions in India while he was considering legal options, following the recent ICC ruling. .

“Following the recent ICC decision, we are suspending the application of the requirement for developers to use the Google Play billing system for the purchase of digital goods and services for transactions by users in India for a period of that we are reviewing our legal options and making sure we can continue to invest in Android and Play,” Google said in an update to the Help Center page on Nov. 1.

The search engine giant has faced global criticism for forcing software developers using its app store to use only its proprietary in-app payment system which charges a commission of up to 30% on in-app purchases.

Google is also facing a separate investigation into its business conduct in India’s news content and smart TV market.

Following the landmark ICC rulings, Google appealed to the NCLAT against both orders.