The Competition Commission of India (CCI) Thursday said that Google abused its position as the dominant search engine here to create a search bias in favour of its own services and has fined the company Rs 135.86 crore, or 5 per cent of the company’s average total revenue generated from India operations from its different business segments for the financial years 2013, 2014 and 2015.
In its order, CCI said: “Google was found to be indulging in practices of search bias and by doing so, it causes harm to its competitors as well as to users…Google was leveraging its dominance in the market for online general web search, to strengthen its position in the market for online syndicate search services”. However, the panel noted that it did not find any contravention with respect to Google’s specialised search design, AdWords and online distribution agreements.
This ruling concludes the 2012 case that was filed by Bharat Matrimony and non-profit body Consumer Unity and Trust Society. CCI then asked its Director General to conduct a detailed probe into the allegations. The report was submitted in August 2015. The antitrust panel mainly looked at four aspects of the case — whether Google biases its search results, whether it imposes unfair conditions on advertisers, whether its distribution and intermediation agreements restrict competition. “The Commission is cognizant of the fact that any intervention in technology markets has to be carefully crafted lest it stifles innovation and denies consumers the benefits that such innovation can offer…This can have a detrimental effect on economic welfare and economic growth, particularly in countries relying on high growth such as India,” the order said. In September 2016, CCI shared its findings with Google and after that the company presented its submissions to the panel.
In a statement, a Google spokesperson said the company was “reviewing the narrow concerns identified by the Commission” and will assess its next steps. “We have always focused on innovating to support the evolving needs of our users. The Competition Commission of India has confirmed that, on the majority of issues it examined, our conduct complies with Indian competition laws,” the spokesperson said.
Even as Google has been embroiled in several antitrust cases across the world, this is only the second time it has been penalised for abusing its dominant position in a market. Last year, the European Commission imposed a fine of €2.4 billion on the firm for favouring its shopping service and demoting offerings by rival players. The company has appealed against the European ruling.
Naval Chopra of law firm Shardul Amarchand Mangaldas, which represented Bharat Matrimony said: “The Google decision is a landmark decision and the CCI has established itself as a trend setter when it comes to online markets. Its investigation report finding Google to be dominant and to have abused its dominance preceded that of any authority … also, the CCI has typically followed a light touch approach in relation to technology markets, and therefore, this order indicates that Google’s conduct was particularly egregious”.