NCLAT reduces Google's penalty by 75% to nearly ₹200cr
What's the story
The National Company Law Appellate Tribunal (NCLAT) has drastically reduced the penalty on Google by the Competition Commission of India (CCI) in October 2022. The fine, originally ₹936.44 crore for allegedly misusing its dominant position in mobile app markets through its Android Play Store, has now been slashed to ₹216.69 crore. The NCLAT directed Google to pay the amount within a month, noting the tech giant had already paid 10% of the total penalty.
Tribunal's decision
Ruling partially supports Google's appeal
The ruling was pronounced by an NCLAT bench headed by chairperson Justice Ashok Bhushan, which partially accepted Google's appeal. The tribunal set aside some portions of CCI's 2022 order while upholding other elements of its findings. A detailed judgment on the matter is awaited. The decision comes as a major relief for Google, which commands a 94.56% market share in the Indian smartphone market with Android, per StatCounter data.
Regulatory concerns
CCI's investigation into Google's practices
In its October 2022 ruling, the CCI found that the Play Store provided Google an unfair advantage by mandating the use of the Google Play Billing System (GPBS) for paid apps and in-app purchases. Developers were prohibited from informing users about alternative payment methods, a restriction deemed unfair by CCI. The regulator also flagged preferential treatment of YouTube and Google Pay on the Play Store as anti-competitive practices. These apps were exempt from GPBS service fees, unlike others.
Company's argument
Google's defense against CCI's findings
Responding to the CCI's ruling, Google argued that the penalty was excessive and lacked sufficient evidence. The company claimed the relevant market was wrongly defined by excluding digital payment alternatives like credit and debit cards. Google also defended GPBS, saying it only collected service fees without hindering other payment processors' operations in India and complied with National Payments Corporation of India (NPCI) regulations for UPI integration.