India orders Google to allow third-party payments, faces another fine

NEW DELHI, October 25 (Reuters) – Alphabet Inc’s subsidiary Google should not restrict app developers from using third-party billing or payment processing services in India, the country’s antitrust agency said on Tuesday. apps.

The Competition Commission of India (CCI) stated that Google (GOOGL.O) is using its “dominant position” to force app developers to use the in-app payment system, and selling in-app digital products is an important tool for developers. earn money from your work.

CCI’s move is the latest setback for Google in one of its priority markets, where it was fined an additional $162 million on Thursday for anticompetitive apps related to the Android operating system and asked to change its approach to the Android platform.

“Our model has kept costs low, empowering India’s digital transformation and expanding reach for hundreds of millions of Indians,” said a Google spokesperson.

“We remain committed to our users and developers and are reviewing the decision to consider next steps.”

The US giant can appeal decisions in an Indian court.

Google was also asked to adopt 8 resolution or action adjustments within three months, including not restricting “app developers from using any third-party billing/payment processing service for in-app purchases or app purchase.” said order.

CCI added that Google should provide full transparency in communication with application developers and detailed information about service fees charged.

The order will come as a huge relief to Indian startups and smaller companies that have long objected to Google’s policy of imposing its own payment system on app developers.

The investigation into Google’s payments ecosystem was launched in 2020 after an antitrust lawsuit was filed against Google. The guard keeps the identity of the complainant confidential upon his request.

Naval Chopra, the antitrust partner at India’s Shardul Amaarchand law firm representing the complainant, told Reuters on Tuesday that CCI’s order will help ensure healthy competition and cut costs for app developers.

Chopra, refusing to reveal the name of the complainant, said: “The CCI order directing Google to allow alternative payment processing systems will remove the artificial barrier Google has set up.” Said.

The search engine giant is also facing a separate investigation into its business behavior in the Indian smart TV market.

He described CCI’s move on Thursday as “a major setback for Indian consumers and businesses”, adding that it would review the order and decide on its next steps.

Google has faced criticism worldwide, including in South Korea, for mandating software developers using its app store to use a proprietary in-app payment system that charges up to 30% commissions on purchases made within an app. Recently, Google has started to allow alternative payment systems in more countries.

According to Counterpoint Research, Google’s Android operating system powers 97% of the 600 million smartphones in India.

Reporting, Editing by Aditya Kalra, Chris Thomas, Praveen Paramasivam and Munsif Vengattil in Bengaluru by Louise Heavens, Bernadette Baum and Kim Coghill

Our Standards: Thomson Reuters Trust Principles.


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