 "Play Store billing case: NCLAT seeks response from Google and CCI")
The National Company Law Appellate Tribunal (NCLAT) on Friday sought Google and the Competition Commission of India’s response on a plea challenging the competition watchdog’s decision to deny interim relief to startups during the ongoing probe against Google’s Play Store billing policy.
The NCLAT has told both the parties to submit their replies before the next hearing on May 24.
The plea was filed by People Interactive India, which has brands such as Shaadi.com, and Sangam.com, and Mebigo Labs Pvt Ltd that owns Kuku FM along with the Indian Broadcasting and Digital Foundation (IBDF) and the Indian Digital Media Industry Foundation (IDMIF).
The petition sought interim protection from Google’s service fees until the Competition Commission of India (CCI) completes its investigation into the tech giant’s billing policy.
In their plea, the companies also appealed to NCLAT to instruct Google not to charge them service fees until the next hearing. However, the appellate tribunal did not grant them this interim protection.
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Reacting to the development, Anupam Mittal, Founder & CEO, People Group said, “The matter is sub-judice, so I wouldn’t like to say much except that we are happy with the progress, and the courts and authorities appear to recognise that Google & other Big Tech gatekeepers will not be allowed to collect tolls from India’s entrepreneurs by abusing their monopolistic power. The future of our economy is at stake.”
CCI had on March 20 declined to restrain Google from levying service fees on app developers until a final decision is made by the regulator.
The CCI also said the Director General (DG) would continue its investigation as ordered by the commission.
“The Commission is of the considered opinion that no case whatsoever has been made out by the informants which warrant the grant of interim relief. Resultantly, the applications stand dismissed,” the CCI had said while rejecting the plea by app developers in its order.
“The DG shall investigate without being swayed in any manner whatsoever by the observations made herein,” the order read.
The regulator in its order said that while there might be concerns about the fairness of Google’s fee structure, it was essential to recognise the costs and responsibilities associated with maintaining and operating app stores.
Google had argued that restricting it from charging a fee in the interim would virtually mean that the tech giant would have to provide its Play Store for free to developers in India.
“No other court or regulator has passed a similar relief despite repeated requests. This recognises that Google cannot provide its platform without any consideration, especially when developers continue to charge their users for digital in-app purchases and enjoy the services of Play,” said the CCI in its order.
CCI has ordered a probe into Google’s Play Store billing policy for imposing an ‘unfair service fee’ on app developers.
In its 21-page order, the CCI had observed that such imposition by Google resulted in app developers having fewer resources to enhance or develop their app offerings, thereby constraining the growth of the app market.
The probe was launched after complaints from a few startups to the CCI, alleging that the tech giant was not complying with its earlier ruling of allowing third-party billing services for in-app purchases.
The contention between app owners and Google is over a service fee of 11-26 per cent that the tech giant charges from select developers who use the in-app billing services.
In March 2024, Google delisted over 100 apps from developers such as Matrimony, Info Edge (running Naukri, 99acres, and Jeevansathi), Shaadi.com, and Kuku FM for not complying with the company’s app billing policy for an extended period until March 1.
A week later, Google temporarily reinstated these apps on the Play Store following a government intervention.
Google did this after the Supreme Court on February 9 refused to pass any interim orders protecting the startups from being removed from Google’s Play Store.