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Home » Industry body ADIF moves CCI against upcoming Google PlayStore policy for in-app purchases

Industry body ADIF moves CCI against upcoming Google PlayStore policy for in-app purchases

Industry body Alliance of Digital India Foundation (ADIF) has asked India’s Competition Commission (ICC) to seek interim relief against upcoming Google Play Store policy changes. In October 2020, Google announced that it was delaying its new policy that would require app developers to use only the Google Billing System (GBS).

The policy will go into effect from March 2022 and this will mean that app developers will be dependent on Google’s systems. This would also mean that the 30% commission will apply to all transactions on the Google Play Store.

In a statement, ADIF said it had filed a petition with the ICC through its lawyers at Sarvada Legal and requested interim measures. The case is already being examined by the ICC for potential abuse of Google’s dominant position in the application market. Previously, a similar petition was filed against Apple, alleging violations of antitrust rules on the issue of payments and in-app purchases. The Apple petition was filed by another group called “Together We Fight Society”

According to ADIF, Google’s policy will see developers paying the search giant 30% in fees, compared to the 2% charged by other payment processing systems. The group says the new policy will have a “destructive effect on the operating margins of a large number of startups and make their business models unworkable.”

“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 in a press release.

ADIF, in its petition, said the policy will “have a disastrous effect on India’s digital ecosystem by reducing the choices available to developers and app users, as well as harming the country’s innovation ecosystem by disrupting the cost structures and margins of many industries. “

The main issue for startups and app developers is the mandatory imposition of the Google Play billing system and the exclusion of other payment methods.

“The issue is not so much 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, ”said Murugavel Janakiraman, Founder and CEO of Matrimony. com, in a press release. .

CCI had already launched an investigation into Google’s payment systems for paid apps and in-app purchases in November 2020. The commission believes at first glance that such a policy is unfair because it restricts the ability of app developers to select a payment processing system. of their choice.

We’ve reached out to Google for a statement on this and will update it as soon as it’s available.

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