NCLAT reserves verdict on Google appeal against ₹1,337 crore CCI penalty for anti-competitive practices in Android market

The National Company Law Appellate Tribunal (NCLAT) on Monday reserved its judgment on Google's appeal against the Competition Commission of India (CCI) order imposing a ₹1,337.76 crore fine on the tech giant for allegedly abusing its dominance in the Android mobile ecosystem..The Bench of NCLAT Chairperson Justice Ashok Bhushan and Dr Alok Srivastava, Member (Technical) reserved the verdict after hearing arguments in the case for over a month. The Appellate Tribunal heard Senior Advocates Arun Kathpalia and Maninder Singh for Google LLC and Google India respectively, and Additional Solicitor General (ASG) N Venkatraman for the CCI. .The Appellate Tribunal had earlier refused to grant any interim relief to Google. The matter then travelled to the Supreme Court, which also denied relief to the company. However, the apex court requested the NCLAT to decide the matter by March 31. .Below is a brief summary of arguments made by the counsel in the case..Arguments for Google LLC.Google LLC argued that CCI's order suffers from confirmation bias and is based on a similar order from the European Commission (EC) in 2018.It was stated that the company's agreements do not prevent equipment manufacturers from pre-installing competing apps with similar functionality.Kathpalia refuted the CCI finding that Google reduced the ability and incentive for manufacturers to develop and sell devices operating on alternative versions of Android by making pre-installation of Google's apps mandatory.He further said mere dominance in a market does not mean abuse of dominance, and the reason Google why is popular among users is because of its effectiveness. Google is the most searched term on Bing, the search engine owned by Microsoft, Kathpalia said..Arguments for CCI.ASG Venkataraman said that Google's policies in India can be summed up in five phrases: digital feudalism, digital slavery, technological captivity, chokepoint capitalism and consumer exploitation.He argued that the companies that did not sign Google's contract have gone extinct. NCLAT was told that all these agreements are linked to one another, and cannot be signed independently.It was stated that Google abused its dominant position in the Android Operating System (OS) market to indulge in unfair trade practices by restricting entry of other applications in its Play Store.The ASG further submitted that Google controls nearly 98% of the smartphone market in the country, and if it is found to be violating competition laws, the regulator is duty bound to direct the company to mend its ways..Intervenors.The Court also heard arguments from intervenors including American gaming company Epic Games, an Indian mobile application named Indus OS and a digital map data development company named MapmyIndia. .Background.In an order passed in October last year, the CCI had levied the penalty on Google, directed it to cease and desist from participating in anti-competitive practices and also to modify its conduct within a defined timeline.The Commission examined various practices of Google in relation to licensing of the Android mobile operating system and several of its mobile applications such as the Play Store, Google Search, Google Chrome, YouTube etc.Based on its assessment, the Commission found Google to be dominant in all the relevant markets.The competition watchdog said that Google's multiple agreements governing the rights and obligations of smart device OEMs result in significant competition for the US tech giant. The underlying objective of Google in imposing various restrictions through the agreements was to protect and strengthen its dominant position in general search services, and thus, its revenues via search advertisements, the Commission concluded.It added that the markets should be allowed to compete on merits and the onus was on the dominant player to show that its conduct does not impinge this competition on merits."By virtue of the agreements discussed above, Google ensured that users continue to use its search services on mobile devices which facilitated un-interrupted growth of advertisement revenue for Google," it had held..CCI imposes ₹1,337 crore penalty on Google for anti-competitive practices in Android mobile devices market.Along with Kathpalia and Singh, a team of lawyers from AZB & Partners and Economic Laws Practice including Hemangini Dadwal, Parthsarathi Jha, Toshit Shandilya, Mohith Gauri, Sayobani Basu, Arunima Chatterjee, Ketki Agrawal, Vanya Chhabra, Atish Ghoshal, Bhaavi Agrawal, Deepanshu Poddar, Abhisar Vidyarthi, Kshitij Wadhwa, Ajay Sabharwal and Prabhas Bajaj appeared for Google LLC and Google India.Advocates Samar Bansal, Manu Chaturvedi, Aakriti Singh and Vedant Kapur assisted ASG Venkataraman for CCI. A team of lawyers from Sarvada Legal and Shardul Amarchand Mangaldas including Abir Roy, Vivek Pandey, Aman Shankar, Sukanya Viswanathan, T Sundar Ramanathan, Naval Chopra, Yaman Verma, Aman Singh Sethi, Raveena Lalit, Prerna Parashar, Parinita Kare, Shally Bhasin, Prateek Yadav, Naval Chopra, Yaman Verma, Aman Singh Sethi, Raveena Lalit, Prerna Parashar, Parinita Kare, Shivek Endlaw and Rohan Bhargava appeared for the three intervenors.