The NCLAT refused to grant Google an interim stay on the CCI fine.

The NCLAT refused to grant Google an interim stay on the CCI fine.
12
Jan-2023

In a setback for Google, an appellate tribunal on Wednesday denied an interim stay on the competition regulator's decision to fine the US tech giant Rs. 936 crore for abusing its dominant position in the market.

The National Company Law Appellate Tribunal ordered Google to deposit 10% of the fine imposed by the Competition Commission of India in connection with its Play Store policies.

A week ago, Google was denied relief from the NCLAT on a separate Rs. 1,337.76 crore fine imposed by CCI for alleged abuse of the US tech giant's dominant position in the Android smartphone operating system in the country. It was instructed to deposit 10% of the fine within four weeks.

Google filed an appeal against the order with the Supreme Court, which agreed to hear it on Monday.

While in the first case, CCI asked Google in October last year to allow smartphone users on the Android platform to uninstall apps and choose a search engine of their choice, the regulator also asked the company to take corrective action on policies that required developers to use Google Play's billing system to list their apps on its Play Store.

On Wednesday, a two-member NCLAT bench comprised of Justices Rakesh Kumar and Alok Srivastava issued notices to CCI and scheduled the matter for hearing on April 17, 2023.

A message sent to Google for feedback received no response.

According to senior advocate Harish Salve, the US firm has appealed the Play Store and Android decisions because the Commission failed to consider the negative consequences for users, developers, and manufacturers.

Google will attempt to establish in the NCLAT hearings that the CCU's directives put in peril technology, security, and the choice that Play and Android provide.

It will also try to prove that the Commission ignored the benefits of Play and Android to Indian end-users, such as enabling mobile access (and thus furthering the goal of increased teledensity, which is central to the Digital India push) and protecting end-users from malware and abusive billing practises.

Google's Play Store business model is inextricably linked to the business models of app developers. There is no charge when app developers distribute their apps for free. Google receives a service fee when app developers sell their apps or digital content within the app to end users.

Google claims that this was done for technical, security, and commercial reasons.

On October 25, the CCI fined Google Rs 936.44 crore for abusing its dominant position in its Play Store policies. The regulator also ordered the company to stop engaging in unfair business practises and to implement various anti-competitive measures within a specified time frame.

Following the CCI's recent ruling, Google said it is "pausing" enforcement of the requirement for developers to use Play's billing system for the purchase of digital goods and services for transactions by users in India while it considers legal options.

"Following the CCI's recent ruling, we are pausing enforcement of the requirement for developers to use Google Play's billing system for the purchase of digital goods and services for transactions by users in India while we review our legal options and ensure we can continue to invest in Android and Play," Google said on November 1 in an update to its help centre page.

The search engine behemoth has come under fire around the world for requiring software developers using its app store to use only its proprietary in-app payment system, which charges a commission of up to 30% on purchases made within an app.

Google is also under investigation in India for its business practises in the news content and Smart TV markets.

Following CCI's landmark decisions, Google filed appeals with the NCLAT against the two orders.

Subscribe to our newsletter

shape