Supreme Court admits appeals against NCLAT order in Google Play Store abuse of dominance case

The Supreme Court on Friday admitted appeals by Google, the Competition Commission of India (CCI) and Alliance Digital India Foundation (ADIF) against a National Company Law Appellate Tribunal (NCLAT) order that had partially upheld the antitrust regulator’s findings that Google abused its dominance in the Android ecosystem [Alphabet v. Competition Commission of India]

Google was accused of abuse of dominance by imposing unfair Play Store policies and promoting its own payments app, Google Pay.

A Bench of Justices PS Narasimha and AS Chandurkar listed the matter for hearing in November.

The case arose from a CCI investigation launched in November 2020 into Google’s billing practices on the Play Store. In October 2022, the CCI concluded that Google abused its dominant position by mandating the use of Google Play Billing System (GPBS) for app purchases, while exempting its own apps like YouTube from similar commission structures.

Google was fined ₹936.44 crore and directed to cease anti-competitive practices, including allowing third-party billing and ensuring data transparency.

In its March 28 ruling, the NCLAT upheld several core findings of abuse. It concluded that Google leveraged its dominance in two relevant markets -licensable operating systems for smartphones and app stores for Android OS - to promote Google Pay, thereby violating Section 4(2)(e) of the Competition Act.

It also upheld the CCI’s finding under Section 4(2)(a)(i) that Google had imposed unfair and discriminatory conditions on developers through mandatory use of GPBS.

However, the NCLAT set aside CCI’s conclusions on denial of market access and restriction of innovation. It noted that Google’s billing services accounted for less than 1% of total UPI transactions and held that there was insufficient evidence of foreclosure or restriction on technical development.

Importantly, the NCLAT overturned several “ex-ante” or preventive directions imposed by the CCI, including obligations based on Google’s designation as a “gatekeeper”.

Citing the 2024 Digital Competition Law Committee Report, the Appellate Tribunal ruled that such forward-looking measures exceeded CCI’s powers under the current ex-post competition law framework.

The ₹936.44 crore penalty was also recalibrated. The NCLAT held that CCI erred in applying the penalty to Google’s global turnover and instead limited it to Play Store-specific revenues, reducing the fine to ₹216.69 crore.

In a May 1 clarification, the NCLAT reinstated two directions which required Google to disclose data policies and refrain from leveraging billing data for competitive advantage. Google’s objection that this amounted to a review was rejected, prompting it to move the Supreme Court.

Google was represented by Senior Advocates Sajan Poovayya and Ritin Rai with Advocates Karan Chandhiok, Deeksha Manchanda, Tarun Donadi, Bhavika Chhabra, Palash Maheshwari, Daayar Singla and Raksha Agarwal from Chandhiok and Mahajan.

CCI was represented by Senior Advocate Balbir Singh with Advocates Samar Bansal, Manu Chaturvedi, Monica Benjamin, Kaustubh Chaturvedi, Vedant Kapur, Karan Sachdev, Shivali Singh, Ananya Singh, Vedant Kohli and Khwaja Umair.

Alliance Digital India Foundation (ADIF) was represented by Senior Advocate Jayant Mehta with Advocates Abir Roy, Vivek Pandey, Aman Shankar, S Panda, Biyanka Bhatia, Shreya Kapoor and Rajat Sharma from SARVADA Legal.