Alphabet Inc's Google was fined ₹936 crore by Competition Commission of India on Tuesday, following an antitrust probe on the tech giant. The probe found the company guilty of abusing the dominant position of Play Store to promote its own in-payment system.
"The Commission hereby directs Google to cease and desist from indulging in anti-competitive practices," CCI said in a statement on Tuesday. It ordered Google to stop restricting app developers from including third-party payment systems in apps available through Play Store.
This is the second such fine Google was slapped with in less than a week - last Thursday the company was fined with ₹1,337.76 for engaging in anti-competitive behaviour in India linked to its ubiquitous smartphone operating system - Android.
With almost 95 per cent of India's smartphone having the Android operating system, Google commands massive dominance over India's smartphone market. The CCI probe found the company to have abused its position to gain further leverage and create barriers for other app developers to compete fairly.
"Google has perpetuated its dominant position in the online search market resulting in denial of market access for competing search apps in contravention of Section 4(2)(c) of the Act. Google has leveraged its dominant position in Play Store to protect its dominant position in online general search in contravention of Section 4(2)(e) of the Act (Competition Act, 2002)."
What Are Anti-Competitive Practices, And How Are They Regulated?
Anti-competitive practices are practices followed by businesses or governments to reduce competition in the market by favouring few dominant players and creating barriers for smaller players.
Types of anti-competitive practices include predatory pricing, price fixing, price discrimination and product tying.
Antitrust law, or anti-monopoly law or competition law, refers to a law made to regulate anti-competitive behaviour by companies, and is implemented in some form or other in many countries. Such a law is intended to stop cartel-like behaviour that represses free trade, abusive behaviour of a dominant player that seeks to uphold its position (such as predatory pricing), and to supervise mergers and acquisitions, especially of potential future competition.
India also has its own antitrust law under the Competition Act, 2002, which replaced the Monopolies and Restrictive Trade Practices Act, 1969. The Competition Commission of India is a statutory body within India's Ministry of Corporate Affairs, that is responsible for enforcing the act.
The act aims to regulate anti-competitive agreements, abuse of dominant positions and combinations (merger or amalgamation amongst enterprises, or acquisition of control, shares, voting rights or assets of an enterprise by another person).
What Are CCI's Orders To Google?
The CCI's probe found that "the practices followed by Google results in leveraging its dominance in market for licensable mobile OS and app stores for Android OS, to protect its position in the downstream markets, in violation of the provisions of Section 4(2)(e) of the Act."
It also noted that the "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 regulatory body has also directed Google to introduce a series of changes to its policies regarding Play Store, which includes allowing developers to include other third-party billing services for purchasing apps, or for in-app purchases. According to the probe report, the following directives require compliance within three months:
- Google shall not impose any Anti-steering Provisions on app developers and shall not restrict them from communicating with their users to promote their apps and offerings, in any manner.
- Google shall not restrict end users, in any manner, to access and use within apps, the features and services offered by app developers.
- Google shall set out a clear and transparent policy on data that is collected on its platform, use of such data by the platform and also the potential and actual sharing of such data with app developers or other entities, including related entities.
- The competitively relevant transaction/ consumer data of apps generated and acquired through GPBS, shall not be leveraged by Google to further its competitive advantage.
- Google shall also provide access to the app developer of the data that has been generated through the concerned app, subject to adequate safeguards, as highlighted in this order.
Google shall not impose any condition (including price related condition) on app developers, which is unfair, unreasonable, discriminatory or disproportionate to the services provided to the app developers. - Google shall ensure complete transparency in communicating to app developers, services provided, and corresponding fee charged. Google shall also publish in an unambiguous manner the payment policy and criteria for applicability of the fee(s).
- Google shall not discriminate against other apps facilitating payment through UPI in India vis-à-vis its own UPI app (Google Pay), in any manner.
Are Other Big Tech Companies Indulging In Such Practices?
This is not the first time Google and other big tech companies have been accused of anti-competitive practices.
Towards the end of 2020, the United States Federal Trade Commission (FTC) and a coalition of 46 states filed an anti-competition lawsuit against social media giant Facebook on 9th December, seeking to break up the company by forcing it to sell Instagram and WhatsApp.
Few months earlier, the US Department of Justice along with 11 state attorneys also filed an antitrust case against Alphabet Inc.'s Google for monopolising the search ad market and engaging in anti-competitive behaviour. A group of 10 US state attorneys also joined in on the antitrust suit against Google on Wednesday, and even accused the company of allegedly colluding with its arch rival Facebook to shut out rival ad exchanges.
Since 2010, the European Union has filed three separate antitrust cases against Google for violating its antitrust laws, which has led to formal charges and fines of up to $10 billion.
In India, an antitrust probe against Google was ordered in 2019 for misusing Android's dominant position in the smartphone operating system market to block out potential rivals by forcing companies to sell smartphones with Android.
In 2020, the Democratic members of the US House Judiciary Subcommittee on Antitrust came out with a 400-plus page report following a 16-month investigation by, which noted that the four biggest tech companies - Amazon, Apple, Facebook and Google - have all engaged in anti-competitive behaviour to amass humongous market power
"To put it simply, companies that once were scrappy, underdog startups that challenged the status quo have become the kinds of monopolies we last saw in the era of oil barons and railroad tycoons," the report stated, and recommended breaking up big tech companies and stopping them from acquiring future competitions.