Indian startup body seeks interim relief from CCI against Google’s PlayStore policy

The development comes after the CCI launched a probe in November last year against Google over allegations of abusing its dominant position to force app makers to exclusively use its billing system.

In its petition to the commission, a copy of which was reviewed by Mint, ADIF said the 30% commission charged by Google is “extremely high and unreasonable”. Further, the industry body emphasized that the main issue was the mandatory implementation of Google Play billing system and phasing out other modes of payment.

“ADIF anticipates that except as ordered by this Hon’ble Commission to maintain status quo until the ongoing investigation is completed, Google will proceed to enforce its terms on the Play Store, which will have adverse and irreversible consequences on India’s early startup ecosystem.” Sijo Kuruvilla George, executive director of ADIF, said.

In addition, higher commissions from Google’s Play Store billing system will have a “disastrous effect” on the operating margins of a large number of startups, ADIF wrote in the petition.

Google India did not respond to Mint’s queries till press time.

“The Commission has the power to grant interim relief during the ongoing investigation, if it thinks there are sufficient reasons for doing so. However, this power is rarely used and complainants have to provide additional evidence to show how non-grant of this relief would lead to market failure,” said Anisha Chand, Partner, Competition and Law Firm Khaitan & Co. distrust in

Earlier this year, the CCI had granted interim relief to hotel chains Treebo and Fabhotel, during an investigation against online travel portal MakeMyTrip (MMT) for abusing its flagship position. While the CCI was still probing the matter, it had asked MMT to re-list the properties of Treebo and Fabhotel.

As part of its November 2020 investigation, the CCI is currently investigating Google in two cases, including “specificity as to mode of payment for in-app purchases and in-app purchases” and “on Android smartphones”. Google Pay’s pre-installation and prominence”. “.

In March, Google said it would reduce its Play Store billing fees globally by 30% to 15% for the first $1 million seen by a developer annually for in-app purchases of digital goods. Google then added that its PlayStore billing system applies to only 3% of developers globally who actually sell in-app digital goods and services. The enforcement deadline for non-compliant Indian developers who sell digital goods to use the Play billing system is March 2022.

“The matter is not so much about the percentage of commission charged as it is about the anti-competitive practice of forcing payment options as well as other payment providers.” Founder and CEO of Matrimony.com Murugavel Janakiraman said that if not kept under control, such anti-competitive policies and gatekeeper commissions would be imposed on more and more categories, which would have a devastating effect on competition and prices in India.

Last year, startup founders including Paytm’s Vijay Shekhar Sharma and RazorPay’s Harshil Mathur publicly criticized Google for making it mandatory for app makers to use their own payment tools for purchases made through the Play Store.