Billing System Probe: Delhi HC Seeks Responses Of Startups, CCI On Google’s Plea

The saga of legal cases involving Google’s contentious user choice billing continues unabated. 

On Wednesday (April 26), the Delhi High Court (HC) sought responses from the Competition Commission of India and the Alliance of Digital India Foundation (ADIF) on a plea filed by Google against the recent order by a single-judge bench of the same court directing the competition watchdog to look into the tech major’s new payment system.

A bench comprising Chief Justice Satish Chandra Sharma and Justice Subramonium Prasad directed the CCI and the ADIF to clear their stance on the matter. Arguing for Google, senior advocate Sajan Poovayya said that he was not seeking an interim order in this regard at the current stage. 

On April 25, Google approached the HC seeking an urgent hearing in the matter arguing that the CCI was scheduled to take up the matter in the afternoon itself in compliance with the single-judge bench order.

However, the court refused to hear the plea on the same day and heard the matter today. This comes amid a protracted legal tussle between Indian startups and the US-based tech giant as the deadline for the implementation of the new billing system expired today (April 26).

Earlier this month, a clutch of Indian startups, under the banner of the ADIF, approached the Delhi HC to keep the new user choice billing system in abeyance till the competition watchdog probed its complaints on Google flouting antitrust directives. 

The ADIF, which filed a case on April 10, called on the HC to issue directions to the CCI to invoke the ‘doctrine of necessity’ which would enable the watchdog to adjudicate the matter without a quorum. 

Subsequently, after hearing all sides, a single judge bench of Justice Tushar Rao Gedela on Monday issued directions to the CCI to take up the matter and come up with a judgement by April 26. In its 38-page order, Justice Gadela noted that any defect in the constitution of the Commission would not invalidate any proceedings ‘so far as its adjudicatory powers are concerned’.

“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,” the bench noted in its order that was made public on Monday. 

Subsequently, Google again moved the Delhi HC. 

The issue at the centre of the debate is Google’s new user choice billing system which was unveiled after the CCI found the tech major guilty of abusing its dominance with regards to Play Store policy. The CCI imposed a fine of INR 936 Cr on Google last October in the matter. It also slapped a penalty of another INR 1,338 Cr fine on the tech giant for flouting antitrust norms in the Android devices market. 

The antitrust directives sought sweeping changes to Google’s operations in the country and, as a result, the big tech major introduced the new payment system which enabled developers to use third-party payment processors. 

However, soon after, Indian startups complained that the new payment mandates were essentially a ‘cloaked version’ of the previous billing regime and thrusted the digital platforms with a hefty 11-26% commissions for not even using Google’s payment systems. Earlier, Google charged 15-30% to developers under the Google Billing and Payments System (GBPS). 

The startups sought the rollback of the system citing violation of the CCI’s October 2022 antitrust directives. Reacting sharply to the new mandates, Shaadi.com CEO Anupam Mital called Google the digital East India Company and accused the tech giant of taking ‘lagaan’ (colonial-era agrarian tax) from local developers.

Chiming in, Matrimony CEO Murugavel Janakiraman, in conversation with Inc42, termed Google a threat to the Indian startup ecosystem and called for rollback of the new system. The matrimonial platform also obtained an injunction in the Madras HC against the new policy citing flouting of RBI guidelines on digital payment mandates.