CCI’s INR 936 Cr Penalty Was Amorphous: Google To NCLAT

SUMMARY

According to the counsel, CCI had not shown any disobedience of norms and regulations by Google but addressed the operation of Google Play Billing System and Google Pay as dominance abuse

The counsel further argued that such allegations must be proved before the court

GBPS only collects service charges and “does not prevent other payment processors from venturing into the Indian payment processing market, the counsel said

Tech giant Google argued before the National Company Law Appellate Tribunal (NCLAT) that the INR 936 Cr penalty levied by the Competition Commission of India (CCI) on the company was “amorphous and overbearing”.

According to Google’s counsel, the charges pressed by CCI were purely based on assumptions. It had not shown any disobedience of norms and regulations by the US-based tech giant but addressed the operation of Google Play Billing System (GPBS) and Google Pay as dominance abuse, ET reported.

The counsel further argued that such allegations must be proved before the court. GBPS only collects service charges and “does not prevent other payment processors from venturing into the Indian payment processing market”.

Due to the current GBPS there may have been a reduction in the share of players in the payment market but CCI needs to analyse and prove that such a system is eroding the competition, the Google counsel added.

“CCI has claimed denial of market access but hasn’t delineated the market,” the counsel added.

During the hearing, the CCI was accused of ignoring the fact that in instance of Google’s priorities towards its own UPI app Google Pay, the company is abiding by the regulations laid down by the National Payments Corporation of India.

According to the counsel, unlike many other UPI apps, the Google Play Store sends payment requests to GPay to authenticate payments which is called a collect-flow system. But as not all apps are mature for this flow, the system wasn’t implemented for other apps.

As the standoff between Google and the Indian startups continues, CCI recently ordered a probe into the tech giant’s contentious user choice billing system.

The order stated that Google violated provisions of Section 4(2)(a), 4(2)(b) and 4(2)(c) of the competition Act. Further on this ground, the CCI directed the director general to submit a consolidated investigation report within a period of 60 days from the date of receipt of this order.

The debate over the billing system of Google emerged after the tech giant reduced its commission to 11-26% following CII’s intervention over the former commission range of 15-30%, for apps requiring in-app purchases.