The Delhi High Court has asked the Competition Commission of India and Alliance of Digital India Foundation (ADIF) to provide their stance on Google’s challenge to an order directing the regulator to investigate the tech giant’s policy on third-party payment processors. The policy allows for paid app downloads and in-app purchases on a commission basis. The single-judge bench had asked the Commission to consider ADIF’s plea against the new billing system by April 26, and the bench of Chief Justice Satish Chandra Sharma and Justice Subramonium Prasad has now issued notice on Google’s appeal against this order. Senior advocate Sajan Poovayya, appearing for the appellant entity, stated that he was “not asking for an interim order” at this stage.
Google had opposed the petition before the single-judge bench on several grounds, including that the Commission was incapable of adjudicating the application filed by the petitioner since there were only two members, and the chairperson was yet to be appointed. However, Justice Tushar Rao Gedela noted in the 38-page order passed on Monday that any vacancy or defect in the constitution of the Commission would not invalidate any proceedings with respect to its adjudicatory powers. According to Additional Solicitor General N Venkataraman, the Commission was formed in accordance with the provisions of the Competition Act and was functional and carrying out adjudicatory functions.
ADIF had approached the single-judge bench earlier this month with the grievance that the anti-trust regulator had failed to act on its application objecting to Google’s new payment policy due to a lack of quorum. Under its “User Choice Billing” policy, which was slated to come into force from April 26, Google would be charging a service fee at 11 per cent or 26 per cent in case of third-party payment processors, which ADIF considers anti-competitive and an attempt to bypass an order passed by the Commission.
ADIF had submitted that Google operates a mobile application marketplace for android devices called “Play Store,” which enjoys supreme dominance in that market. Under the present framework, there is no requirement to pay any commission for third-party payment processors. In October last year, the Commission imposed a penalty of Rs 936 crore, asking Google to allow and not restrict app developers from using any third-party billing service and not impose any discriminatory condition.
ADIF had argued that the Commission must invoke the “doctrine of necessity” and look into the matter. A refusal to intervene would cause irreversible harm to the petitioners and other app developers, and lead to distortion in the market. The implementation of the policy must be kept in abeyance till the matter is looked into by the anti-trust regulator, the petitioner had prayed.
