As NCLAT Principal Bench resumes hearings in the Android case on Friday (day three), tech giant Google has been making multiple arguments over the past two days against the CCI ruling of October 20 last year.
The core of Google’s arguments so far has been that the CCI regulation has not been able to demonstrate any damage to competition in India; suffers from confirmation bias and completely ignores the relevant market in India, evidence it has in this regard and relies on statements/findings from the European Commission and passes them off as its own – first in the DG Report and then reinforced by the Competition Commission of India ( CCI), which tolerates and confirms the same.
Google has claimed that CCI has faulted the tech giant’s policies without any basis whatsoever and despite the fact that the Android operating system (OS) has made a major contribution to the tech/mobile industry and led to a thriving mobile market. According to submissions from Senior Counsel Arun Kathpalia, who is representing Google before NCLAT, significant credit goes to Google’s pro-competitive policies.
The tech giant has further emphasized that there are three main players in the mobile (Android) ecosystem – OEMs, OS developers (like Google) and app developers, all of which are interdependent. Google’s Android operating system and ecosystem is a success story as it has created a thriving global market with 1,100 OEMs, 15,000 devices and millions of apps. This has to be compared to the ecosystem before 2007, where there were a handful of each of the participants.
The tech giant highlighted how its efforts to develop and constantly update the Android operating system, which it makes available to OEMs free of charge, has contributed to lower device prices – from ₹12,000-13,000 for entry-level models to ₹1,500 now. There are now 500 million Android compatible devices in India.
theory of action
The tech giant claimed that all of its actions to build the Android operating system ecosystem had pro-competitive effects and that the CCI should (but did not) provide a convincing anti-competitive effects analysis.
Google has argued before the NCLAT Principal Bench that the Preamble and Section 18 of the Indian Competition Law leave no doubt that CCI must demonstrate anti-competitive behavior by companies in order to find an abuse. CCI has failed utterly in this regard, and the entire analysis in the contested order is based on speculation (“may cause”, “possibly cause”), according to Google’s submission, adding that speculation and conjecture are not the same as determining effects .
However, N Venkatraman, Additional Solicitor General, representing CCI in the Android case, disagreed. From a legal point of view, a clear distinction must be made between the nature of the conclusions according to Section 3 and Section 4 (concerns abuse of a dominant position). According to § 3 effects are to be proven. According to § 4, according to the ASG, the mere misuse must be proven. The CCI has at times taken the position that applicable law does not require that effects need not be demonstrated in order to demonstrate abuse of a dominant position (Section 4). The Government also recently decided not to accept the Standing Committee’s recommendation to include the “Effects Theory” in the abuse of dominant position provision in competition law.
Google has argued that even the complainant in the Android case was not a party (OEM, app developer or OS developer) but three interns.
MADA allegations
Google has claimed that nothing in the Mobile Application Distribution Agreement (MADA) is intended to restrict the installation of other apps, including competitor apps. Obliging OEMs to pre-install and prominently place the entire GMS suite (Earth widget + Play Store icon + folder containing the remaining apps on the home screen) and the requirement that GMS suite not uninstall apps, only can be disabled are “minimum requirements” that ensure a working device and best user experience. Google’s interest in ensuring the success of the Android platform is above all others and therefore minimum requirements cannot be left to other stakeholders, tech giant NCLAT has submitted.
Google has also argued that MADA and other agreements cannot be unreasonable as they existed years before the tech giant established its dominance in said markets. It was highlighted that MADA and other agreements were not signed with OEMs due to dominance. MADA and other agreements are also completely voluntary and without monetary consideration. The tech giant has also claimed that it is irrelevant that OEMs are unable to negotiate MADA and other agreements. MADA is a standard contract signed with thousands of OEMs, and negotiating MADA will result in inconsistent standards, according to Google.
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