ADIF seeks interim relief from CCI against Google's controversial policy

The Alliance of Digital India Foundation (ADIF) has filed a petition before the Competition Commission of India (CCI) through their lawyers at Sarvada Legal seeking interim relief from Google’s new PlayStore policy which goes into effect from March 2022.

The matter is already being looked into by the CCI for potential abuse of dominance by Google in the app market.

This relief has been sought by ADIF on behalf of App developers as Google’s new policy will restrict certain categories of apps to use only Google Billing System (GBS) for accepting payments.

This would be an issue for app developers because GBS charges 30% commission for all transactions on the Google Play Store, compared to 2% charged by other payment processing systems.

There is a strong case for seeking such relief as this new policy, when it goes into effect next March, would have a destructive effect on the operating margins of a large number of startups and make their business models infeasible.

“ADIF foresees that barring an order passed by this Hon’ble Commission to maintain  status-quo until the completion of the ongoing inquiry, Google shall proceed to enforce its terms on the Play Store, thereby leading to adverse and irreversible consequences on India’s fledgling startup ecosystem,” Sijo Kuruvilla George, executive director, ADIF, said.

The CCI had in November 2020 directed a probe by the Director General into the issue of mandatory use of Google Play Store’s payment system for paid apps and in-app purchases. The commission is of the prima facie view that such a policy is unfair as it restricts the ability of app developers to select a payment processing system of their choice.

In its petition to the commission, ADIF, which represents the interests of various stakeholders such as startups, app developers, etc. and espouses the objective of improving the startup ecosystem of the country, has stated that the 30% commission charged by Google is extremely high and unfair.

However, the organization said that the core issue is the mandatory imposition of the Google Play Billing system and the exclusion of other methods of payment.