An Indian start-up files a complaint against Google before the CCI

The Alliance of Digital India Foundation (ADIF) has filed a petition with the Competition Commission of India (ICC) for an interim measure of the new Google Play Store policy which will take effect from March 2022. The case is already being considered by the ICC for abuse Google’s dominant position potential in the application market.

This relief was requested by ADIF on behalf of app developers, as Google’s new policy will restrict certain categories of apps to only using the Google Billing System (GBS) to accept payments. This would be a problem for app developers, as GBS charges 30% commission for all transactions on the Google Play Store, compared to the 2% charged by other payment processing systems. “There are strong arguments in favor of such relief because this new policy, when it comes into effect next March, would have a destructive effect on the operating margins of a large number of start-ups and would render their unworkable business models, ”ADIF said. in a report.

In November 2020, the CCI led an investigation by the Director General into the question of the compulsory use of the Google Play Store payment system for paid applications and in-app purchases.

The petition

In its petition to the committee, ADIF, which represents the interests of various stakeholders such as start-ups, application developers, etc. and hugs the goal of improving the country’s start-up ecosystem, said the 30 percent commission charged by Google is extremely high and unfair. However, the organization said the central issue was the mandatory imposition of the Google Play billing system and the exclusion of other payment methods.

“This will have a disastrous effect on India’s digital ecosystem by reducing the choices available in the hands of application developers and users, as well as harming the country’s innovation ecosystem by disrupting structures. costs and margins of several industries, ”he said.

While ADIF will support the Director General’s ongoing investigation into the matter, it was forced to move the request for interim measures to protect the choice of application developers to use other payment systems with conditions. much more favorable service.

“The ADIF provides that unless an order of this honorable commission maintains the status quo until the end of the current investigation, Google will proceed to the application of its conditions on the Play Store, thus resulting in negative and irreversible consequences for the young Indian start-up. ecosystem, ”said Sijo Kuruvilla George, Executive Director of the Alliance of Digital India Foundation.

Murugavel Janakiraman, Founder and CEO of Matrimony.com, said: “The issue is not so much about the percentage of commission charged as it is the anti-competitive practice of forcing a payment option as well as forcing other payment providers. . If left unchecked, such anti-competitive policies and control fees will be imposed on more and more categories, causing a disastrous effect on competition and prices in India. “

ADIF believes that if the status quo is not maintained pending the completion of the investigation, Google will apply its terms on the Play Store in March 2022, with irreversible consequences for the Indian startup ecosystem.

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