CCI imposes Rs 1,338-cr fine on Google for unfair biz practices

New Delhi, October 20

The Competition Commission of India (CCI) on Thursday imposed a penalty of Rs 1,337.76 crore on Google for abusing its dominant position in multiple markets in the Android mobile device ecosystem.

Besides, the fair trade regulator has directed the internet major to cease and desist from unfair business practices. In a statement, the CCI said it has also directed Google to modify its conduct within a defined timeline.

Abusing dominant position: Regulator

• In April 2019, the regulator ordered a detailed probe into the matter following complaints by consumers of Android-based smartphones
• The allegations pertained to two agreements — Mobile Application Distribution Agreement and Anti-Fragmentation Agreement — which were entered into by the OEMs of Android OS with Google
• The search engine giant has been directed to modify its conduct within a defined timeline

In April 2019, the regulator ordered a detailed probe in the matter following complaints by consumers of Android-based smartphones in the country. Android is an open-source, mobile operating system installed by Original Equipment Manufacturers (OEMs) of smartphones and tablets.

The allegations of unfair business practices pertained to two agreements —Mobile Application Distribution Agreement (MADA) and Anti-Fragmentation Agreement (AFA) — which were entered into by the OEMs of Android OS with Google.

In the statement, the regulator said it has imposed a penalty of Rs 1,337.76 crore on Google for abusing its dominant position in multiple markets in the Android mobile device ecosystem apart from issuing the cease and desist order.

As per the statement, the CCI said mandatory pre-installation of entire Google Mobile Suite (GMS) under MADA, with no option to un-install the same, and their prominent placement amounts to imposition of unfair condition on the device manufacturers and thereby contravenes competition law.

“These obligations are also found to be in the nature of supplementary obligations imposed by Google on OEMs and thus, in contravention of Section 4(2)(d) of the Act,” it added. Section 4 of the Competition Act pertains to abuse of dominant position.

Google has perpetuated its dominant position in the online search market resulting in denial of market access for competing search apps. Also, it has leveraged its dominant position in the app store market for Android OS to protect its position in online general search which violates the competition law.

Further, the CCI noted that the internet major has leveraged its dominant position in the app store market for Android OS to enter as well as protect its position in non-OS specific web browser market through Google Chrome App.