Startup Body Postpones CCI To Request Temporary Relief From Google Play Commissions

The Alliance of Digital India Foundation on Monday postponed India’s competition regulator to seek a temporary exemption from Google’s policy on collecting commission for payments for apps in its Play Store pending an ongoing antitrust investigation against the big tech giant.

ADIF is a Delhi-based think tank made up of Indian startups and entrepreneurs.

Google had postponed the implementation of its payments policy, where it collects a 30% commission from developers for all in-app purchases, to March next year after prominent Indian internet entrepreneurs such as Vijay Shekhar Sharma from Paytm and Murugavel Janakiraman from BharatMatrimony Pressure was put on the IT ministry on this issue.

“Google’s new policy restricts certain categories of apps to only use the Google Billing System (GBS) to accept payments. This would be a problem for app developers as GBS charges 30% commission on all transactions on the Google Play Store compared to 2% charged by other payment processing systems, “the ADIF said in a statement.

Should this policy come into force, according to ADIF, it would have “destructive effects on the operating margins of a large number of startups and make their business models impossible”.

Google declined to comment.

The ADIF petition comes just weeks after the Indian Competition Commission investigative arm found Google guilty of adopting anti-competitive and restrictive practices in the Android operating system market. These revelations came to light in a leaked report that Google had also received moved the Delhi High Court citing violations of privileges.

In November 2020, the Chamber of Industry and Commerce initiated an investigation by the Director General into the question of the mandatory use of the Google Play Store’s payment system for paid apps and in-app purchases. The Commission believes that such a directive is unfair at first sight as it restricts the ability of app developers to choose a payment processing system of their choice.

Indian app developers are also empowered by global laws like a South Korean who set a global precedent by passing laws forcing Google and Apple to open their app stores to alternative payment systems.