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CCI’s fine on Google could exceed Rs 136 crore if found guilty of abusing market dominance: report

The Competition Commission of India could potentially fine Google of over Rs 136 crore if the watchdog finds it guilty of using its dominance to curtail market access for smaller players, reports The Print, citing an anonymous person in the CCI. The person added that the “implications” of this case were serious and that the CCI “is taking the matter seriously”. It was earlier reported that CCI’s investigations arm would complete the wider probe in the case within 150 days, however, the source said that it could possibly take two years to “conduct a thorough investigation”.

The investigation had resulted from a case filed by contract employees of the CCI, but the investigation will be carried out by permanent employees of the CCI’s investigation team, which has around 30 members, adds the report.

CCI’s investigation into Google

The CCI had ordered an investigation into Google, in May, after deciding that there was merit in the accusations of market dominance against Google. The commission had begun looking into the complaint last year, which is similar to the one Google faced in Europe and paid a $5 billion penalty for. Following the investigation’s initiation, the CCI, in June, sought details of agreements between smartphone manufacturers and Google, including i) license fees or royalty payments made to Google for using the Android OS and Google mobile services on a yearly basis from April 2011 to March 2019, and ii) whether Google had imposed any restrictions on using its mobile apps and services since April 2011.

In July, we reported that per a 14-page order issued by the CCI in April, Google appeared to have misused its dominant position in India by making it harder for phone makers to choose alternative versions of Android (Read the complete order here). The CCI’s order found that Google’s restrictions on manufacturers seemed to amount to the imposition of “unfair conditions” under India’s competition law. At that time, Google told MediaNama: “Android has enabled millions of Indians to connect to the internet by making mobile devices more affordable. We look forward to working with the Competition Commission of India to demonstrate how Android has led to more competition and innovation, not less.”

Google’s previous anti-trust troubles in India and the EU

So far, Google has been fined about $9 billion in anti-trust penalties. It has already been fined by the CCI once and by EU’s European Commission on three separate occasions:

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  • In February, CCI had fined Google Rs 135.86 crore (nearly $21 million) for “search bias” and abusing its dominant position in the market. The allegations largely revolved around the design of the Google search engine result page. It was also alleged that the company was leveraging its dominance in web search to strengthen its position in online syndicate search services, as competitors were denied access to the market.
  • In March, the European Commission fined Google €1.49 billion, or 1.29% of its 2018 turnover, for breaching EU antitrust rules. The commission said that Google abused its market dominance by placing restrictions on third-party websites which prevented Google’s rivals from placing ads on the websites. The restrictions related to Google’s advertising contracts with publishers, which favoured Google’s own ads over publishers’ (and thus competitors’) ads. The company’s practices amounted to an abuse of Google’s dominant position in the search ads intermediation market, the commission stated, since it prevented competition on merit. It said, “Market dominance is, as such, not illegal under EU antitrust rules [but] dominant companies have a special responsibility not to abuse their powerful market position by restricting competition, either in the market where they are dominant or in separate markets.”
  • Last July, the European Commission had imposed a $5 billion fine on Google for violating anti-trust laws, saying the company abused its position in three major ways: by compulsorily bundling Search and Chrome with its Play Store and operating system; blocking phone manufacturers from running forked versions of Android; and paying phone manufacturers (such as Apple) and service providers to “exclusively pre-install the Search app on their devices”.
  • In June 2017, the European Commission had fined Google €2.42 billion for abusing its dominance as a search engine by giving an illegal advantage to its own comparison shopping service.

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