CCI acts against Google’s planned PlayStore policy for in-app purchases, according to industry group ADIF

The Alliance of Digital India Foundation (ADIF) has filed a petition with India’s Competition Commission (CCI) seeking interim relief from Google’s forthcoming PlayStore policy changes. Google said in October 2020 that it will postpone its new policy requiring app developers to utilise only the Google Billing System (GBS).

The regulation will take effect in March 2022, and app developers will be completely reliant on Google’s infrastructure. It also means that the 30% fee will be applied to all Google Play Store sales.

ADIF said in a statement that they filed a case with CCI through its lawyers at Sarvada Legal, seeking temporary relief. The CCI is already investigating the case for possible abuse of power by Google in the app industry. A similar lawsuit was previously brought against Apple, alleging antitrust breaches related to in-app payments and sales. Another organisation named “Together We Fight Society” filed the Apple petition.

According to the ADIF, Google’s policy would require developers to pay a 30% fee to the search engine, compared to 2% for other payment processing providers. According to the organisation, the new legislation will have a “destructive effect on the environment.”

“Without an order from this Hon’ble Commission to maintain the status quo until the completion of the ongoing inquiry,” Sijo Kuruvilla George, Executive Director of the Alliance of Digital India Foundation, said in a press statement, “Google will proceed to enforce its terms on the Play Store, resulting in adverse and irreversible consequences on India’s fledgling startup ecosystem.”

The proposal, according to ADIF’s appeal, will have “a devastating effect on India’s digital ecosystem by limiting the options accessible to app developers and consumers, as well as hurting the country’s innovation environment by altering the cost structures and margins of numerous industries.”

The forced imposition of the Google Play Billing system, as well as the rejection of other payment methods, is the main concern for startups and app developers.

“The issue isn’t so much about the commission % charged as it is about the anti-competitive practise of imposing a payment choice as well as driving out alternative payment providers.” If not reined in, such anti-competitive rules and gatekeeper commissions will be imposed on an increasing number of categories, wreaking havoc on competition and pricing in India,” founder and CEO Murugavel Janakiraman said in a statement.

In November 2020, CCI began an investigation into Google’s payment mechanisms for premium applications and in-app purchases. The commission believes that such a restriction is discriminatory since it inhibits app developers’ freedom to choose their preferred payment processing solution.

We’ve reached out to Google for comment on the matter, and we’ll update as soon as we hear back.