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NCLAT Seeks Replies from Google and CCI on Play Store Billing Policy Challenge

• ByStartupStory     |    May 11, 2024

In a significant development, the National Company Law Appellate Tribunal (NCLAT) has directed tech giant Google and the Competition Commission of India (CCI), along with other respondents, to respond to petitions challenging Google’s Play Store billing policy.

A two-member NCLAT bench, after a brief hearing on Friday, instructed the respondents to file their responses within a week and a counter reply, if necessary. The matter has been slated for the next hearing on May 24.

The petitions were filed by the Indian Broadcasting and Digital Foundation (IBDF), Indian Digital Media Industry Foundation, People Interactive India (operator of Shaadi.com), and Kuku FM operator Mebigo Labs. They contest the CCI’s decision on March 20, 2024, which declined interim relief against Google’s Play Store billing policy, allowing Google to continue collecting fees.

The CCI dismissed four petitions from Indian app companies against Google’s new policy of charging 11 to 26 per cent on in-app payments. The aggrieved Indian app firms argue that Google’s Play Store payment policies are anti-competitive.

In its order, the CCI clarified that its decision “shall not be tantamount to a final expression of opinion on the merits of the case.” The petitions sought to restrain Google from collecting fees for transactions involving paid downloads or in-app purchases of digital products/services.

“While there may be concerns about the fairness of Google’s fee structure as outlined by the regulator in its prima facie order dated March 15, it is essential to recognize the costs and responsibilities associated with maintaining and operating app stores,” noted the CCI.

The CCI’s order for a detailed investigation followed complaints about Google’s updated payment policies in relation to its proprietary app store, the Google Play Store, which were alleged to violate competition laws.

The regulator’s decision to probe Google’s Users Choice Billing (UCB) payments policy comes less than two years after it penalized Google and issued directives regarding Play Store policies.

These complaints arose after Google temporarily removed certain apps from the Play Store due to payment issues, later reinstating them. The complainants argue that these payment policies adversely affect various stakeholders, including app developers, payment processors, and users.

The NCLAT’s directive to Google and other respondents signals a crucial step in the legal battle over Google’s Play Store billing practices, which has wide-ranging implications for India’s digital ecosystem.

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