The service fee charged for in-app payments violates a previous antitrust directive. The regulatory order, obtained by Reuters, reveals that Match Group, the owner of Tinder, and several Indian startups have requested the CCI to examine Google’s User Choice Billing (UCB) system, claiming it is anti-competitive.The CCI has issued an order stating that an inquiry is necessary. While the order is not public, Google has yet to respond to the request for comment. In October, the CCI imposed a $113 million fine on Google, ruling that it must allow the use of third-party billing and cease its practice of compelling developers to use its in-app payment system, which levies a commission ranging from 15% to 30%.Following this, Google introduced UCB, enabling alternative payment methods alongside its own for in-app digital content purchases.
However, certain companies argue that the new system still imposes a high service fee of 11% to 26%. Match and the Alliance of Digital India Foundation contend that Google has not complied with the earlier antitrust directive, which prohibited the imposition of unfair and disproportionate conditions.The CCI has instructed Google to provide explanations regarding provisions related to the in-app payment system both before and after the introduction of UCB. Additionally, Google must furnish details about its policies pertaining to the sharing of user and app developer data.
The company has been given four weeks to respond.Google has previously stated that the service fee helps fund investments in the Google Play app store and the Android operating system, ensuring their distribution remains free. It also covers developer tools and analytic services. With India being a crucial growth market for Google, the company faces other regulatory challenges, such as having to modify its Android system marketing practices.