The CCI has dismissed four petitions of Indian app companies filed against Google’s new Play Store billing policy to levy an 11 to 26% charge on in-app payments. File
| Photo Credit: Reuters

Fair trade regulator CCI on March 20 dismissed four petitions of Indian app companies filed against Google’s new Play Store billing policy to levy an 11 to 26% charge on in-app payments.

Indian-origin app firms alleged that Google’s Play Store payment policies are anti-competitive.

However, CCI made clear that nothing stated in this order shall be as tantamount to a final expression of opinion on the merits of the case, and the Director General will conduct the investigation without being swayed in any manner whatsoever by the observations made herein.

“The commission is of the view that the informants have failed to meet the necessary criteria for grant of interim relief as propounded by the Supreme Court.

“The informants have not been able to project any higher level of prima facie case warranting a positive direction as sought for by the informants at the interim stage,” CCI said in its order.

The complainants were Anupam Mittal’s People Interactive India Pvt Ltd, Mebigo Labs, the Indian Broadcasting and Digital Foundation (IBDF) and the Indian Digital Media Industry Foundation (IDMIF).

The petitions were seeking the regulator to restrain Google from collecting any fee for transactions involving paid downloads or in-app purchases on apps offering digital products/ services.

While there may be concerns about the fairness of Google’s fee structure as outlined by the regulator in its prima facie order dated March 15, it is essential to recognise the costs and responsibilities associated with maintaining and operating app stores, CCI noted.

In its order, the regulator stated, “Informants have not been able to demonstrate a case in their favour for grant of interim relief for complete restraint on Google from the collection of its fee”.

CCI also said that no case whatsoever has been made out by the informants, which warrants a grant of interim relief. Accordingly, the applications stand dismissed.

Indian apps representative body Alliance of Digital India Foundation (ADIF) said it is concerned about the high commission imposed during in-app purchases that are not in the best interest of our nation’s digital entrepreneurs.

“These rates, ranging from 11 to 26 per cent, are significantly higher. The rates should be reconsidered and mutually favourable to both. This model will support the growth and sustainability of India’s digital economy. We trust the judicial process and await further hearings with the hope that the best interests of the Indian app development community will be prioritised by the Indian judiciary,” ADIF Associate Director Prateek Jain said.

The order came after the Competition Commission of India (CCI), on March 15, ordered a probe against Google for alleged discriminatory practices with respect to its Play Store pricing policy after finding a prima facie violation of the competition law.

The order for detailed investigation comes less than two years after CCI penalised and passed various directions against Google regarding Play Store policies.

The regulator’s decision came on a raft of complaints that Google’s updated payment policies in relation to its proprietary app store — Google Play Store — which is alleged to be in violation of the competition law.

The order also comes after Google removed some apps from the Play Store over payment issues and later reinstated them.

In their complaints, they alleged that the payment policies are stated to be impacting several stakeholders, including app developers, payment processors and users alike.

Alphabet Inc’s Google has underscored that it takes its commitment to follow local laws and regulations seriously as India’s antitrust body on Friday ordered a probe against the US company for implementation of its policies in a “discriminatory manner”.

Indian startups have been at odds with Google for months over the fee it charges for in-app payments.

The dispute escalated earlier this month after Google removed more than 100 Indian apps from its app store for violations related to billing, though it restored them after the Indian government intervened.

“We are examining CCI’s order initiating the investigation. The CCI has previously examined our service fee in detail between 2020 and 2022 and found no illegality. However, we take our commitment to comply with local laws and regulations in India seriously and will cooperate with the process in every way,” said a Google spokesperson. 

The startups had asked the Competition Commission of India (CCI) to look into the matter and the watchdog on Friday ordered an investigation, saying: “Google is implementing its policies in a discriminatory manner”.

The competition watchdog also directed its investigation unit to complete the probe within 60 days.

The dispute centres on efforts by some Indian startups to stop Google from imposing a fee of 11% to 26% on in-app payments, after the country’s antitrust authorities ordered it to dismantle a system of charging 15% to 30% in 2022.

In 2020, Google briefly removed popular Indian payments app Paytm from its Play Store citing some policy violations.