NCLAT Directs Google, CCI to File Replies on Play Store Billing Dispute

The National Company Law Appellate Tribunal (NCLAT) has recently mandated tech behemoth Google and the Competition Commission of India (CCI), among other entities, to submit their responses concerning appeals against Google's Play Store billing policy. This directive was issued following a succinct hearing on Friday, setting a deadline for the involved parties to present their replies within a week. Additionally, they are allowed to file counter-replies. The matter is scheduled for further examination on May 24.

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The appeals originate from several key players in the digital and broadcasting sectors, including the Indian Broadcasting and Digital Foundation (IBDF), Indian Digital Media Industry Foundation, People Interactive India (which operates Shaadi.com), and Mebigo Labs (the company behind Kuku FM). These entities are contesting a decision by the CCI dated March 20, 2024, which refused to provide interim relief against Google's Play Store billing policy or to prevent Google from imposing fees.

On March 20, the CCI dismissed four petitions from Indian app companies against Google's new Play Store billing policy, which introduces an 11 to 26 percent charge on in-app payments. This policy was challenged before the NCLAT by the aggrieved Indian-origin app firms, who argue that Google's Play Store payment policies are anti-competitive.

The CCI, in its ruling, clarified that its decision should not be seen as a final judgment on the case's merits. It emphasized that the investigation by the Director General would proceed without bias based on the preliminary observations. The commission concluded that the appellants did not present a sufficiently strong prima facie case to justify interim relief as defined by the Supreme Court guidelines.

The petitions sought to prevent Google from levying any charges on transactions involving paid downloads or in-app purchases of digital products/services. Despite acknowledging concerns over Google's fee structure, the CCI highlighted the significant costs and responsibilities of maintaining and operating app stores.

This development follows a March 15 directive from the CCI to investigate Google for alleged discriminatory practices in its Play Store pricing policy, identifying a prima facie violation of competition law. This investigation was initiated less than two years after CCI imposed penalties and issued directives against Google concerning its Play Store policies. The regulator's decision was influenced by complaints that Google's updated payment policies could potentially breach competition law. Additionally, there were instances where Google removed certain apps from the Play Store over payment disputes before reinstating them. The complaints suggest that these payment policies adversely affect various stakeholders, including app developers, payment processors, and users.