CCI Imposes ₹936.44 Crores Penalty On Google Over Play Store Policies

New Delhi: After a recent penalty imposed on Google for anti-competitive practices a few days ago, the Competition Commission of India (CCI) on Tuesday imposed a further ₹936.44 crores penalty for abusing its dominant position with respect to its Play Store policies.

The Commission in a statement directed Google to modify its conduct within a defined timeline. Based on an assessment, CCI said it found Google to be dominant in markets for licensable OS for smart mobile devices and market for apps on Play Store.

The competition watchdog said selling in-app digital goods constitutes an important means for app developers to monetize their creations/innovations. However, for in-app digital goods to be distributed to purchasing users, developers must configure their apps so that all purchases of the digital goods go through Google’s payment system, which processes the transactions.

The antitrust body said Google’s Play Store policies require the App developers to exclusively and mandatorily use Google Play’s Billing System (GPBS) not only for receiving payments for Apps (and other digital products like audio, video, games) distributed/sold through the Google Play Store but also for certain in-app purchases i.e. purchases made by users of Apps after they have downloaded/ purchased the App from the Play Store.

Further, app developers cannot, within an app, provide users with a direct link to a webpage containing an alternative payment method or use language that encourages a user to purchase the digital item outside of the app (anti-steering provisions).

Based on its assessment, the CCI in the statement concluded that making access to the Play Store, for app developers, dependent on mandatory usage of GPBS for paid apps and in-app purchases constitutes an imposition of unfair conditions on app developers. Thus, Google is found to be in violation of the provisions of Section 4(2)(a)(i) of the Act.

It said Google is found to be following discriminatory practices by not using GPBS for its own applications i.e., YouTube.

It said mandatory imposition of GPBS by Google, also results in denial of market access for payment aggregators as well as app developers, in violation of the provisions of Section 4(2)(c) of the Act.

The practices followed by Google results in leveraging its dominance in the market for licensable mobile OS and app stores for Android OS, to protect its position in the downstream markets, is in violation of the provisions of Section 4(2)(e) of the Act.

CCI said different methodologies used by Google to integrate its own UPI app vis-a-vis other rival UPI apps, with the Play Store results in violation of its norms.
Accordingly, in terms of the provisions of Section 27 of the Act, the CCI said it hereby directs Google to cease and desist from indulging in Anti-competitive practices that have been found to be in contravention of the provisions of Section 4 of the Act, as detailed in this order.

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