The Supreme Court on Monday asked US tech giant Google whether it was open to having similar standards for India as existing in Europe with regard to its Android smartphone operating system while agreeing to hear the company’s appeal on Wednesday against the imposition of a monetary penalty of ₹1,337 crore by the Competition Commission of India (CCI) over alleged abuse of its dominant position in the Android smartphone ecosphere.
Hearing the tech major’s appeal against the order of the National Company Law Appellate Tribunal (NCLAT) order of January 4 refusing to stay the CCI order of October 20, a bench headed by Chief Justice of India (CJI) Dhananjaya Y Chandrachud said, “Are you (Google) willing to place the same regime as you put in Europe. Reflect on it and come back.”
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Last year, Google had paid a whopping 4.125 billion Euros to the European Union (EU) after losing on its appeal in an anti-trust case linked to its Android operating system. The European Court of Justice held that Google imposed “unlawful restrictions” on makers of Android smartphones while abusing the “dominant position of its search engine”.
Additional solicitor general (ASG) N Venkatraman, citing the EU decision, submitted to the court that Google cannot be discriminating against Indian users and operating systems (OS) and there existed “fairly shocking and startling data” to demonstrate this fact. “Beginning October 20, they had time of 90 days to comply. The EU held them to be dominant and the sum of 4 billion Euros has been totally paid. We are a Third World country. How can they distinguish between Indian consumers and OS and European consumers and OS.”
The bench, also comprising of justices PS Narasimha and JB Pardiwala, asked Google to provide information about the compliance undertaken by the petitioner company in Europe and said, “What are the steps Google has put in place in EU. Are you (Google) ready to put in place a similar compliance in India?” The court posted the matter for hearing on Wednesday.
Senior advocate Abhishek Manu Singhvi, appearing for Google along with senior advocate Maninder Singh, told the court that the NCLAT committed a legal error by holding that the US-based tech giant failed to show urgency by using the statutory two-month period for filing its appeal. The NCLAT refused to pass any interim stay and directed the matter to be taken up in April subject to deposit of 10% of the total cost within three weeks.
The bench remarked, “The order was passed on October 20 and with a battery of lawyers, you go to the tribunal only on January 4. These are contrived emergencies which are created. We have also been at the bar. You create such an emergency that the tribunal is constrained to extend time. You could have filed it in advance.”
Singhvi told the court that the CCI order was to take effect on January 19 and by keeping the hearing in April, its stay application would become fait accompli. Further, with regard to the EU order, Singhvi pointed out that it was with regard to Mobile Application Distribution Agreement (MADA). In India, Google claimed that through MADA, the company licenses high quality apps to device manufacturers and users for free on a non-exclusive basis. It also offers promotional payments to device manufacturers under the revenue sharing agreements for the search service through which Google mainly generates revenues, Google stated in its appeal.
Seeking stay of the CCI order, Google’s plea said, “The Commission’s order undermines public interest, user safety and privacy for Indian Android users. It risks severe harm to Indian consumers and businesses, and opens new back -doors to foreign actors looking to compromise the security of Indian Android device users.”
The tech giant was referring to the direction of CCI to “allow developers of app stores to distribute their app stores through Play Store (Google’s own Android app store).” The company said that third party app stores have a far greater prevalence and risk of malware and “users and manufacturers will stop trusting Play Store as a secure distribution channel for apps in the future.”
The order of the Commission came on a bunch of three petitions which accused Google LLC and Google India Private Limited of abusing its dominant position under Section 4 of the Competition Act, 2002. They claimed that Google’s pre-loaded apps in smartphones sold or manufactured in India hindered development of rival mobile applications in the market.
