Madras High Court division bench dismisses tech companies appeal on Google’s billing system

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The Madras High Court, on Friday, dismissed civil appeals filed by mobile app companies challenging a prior single-judge bench’s decision that upheld Google’s new user choice billing system. The contentious issue revolves around the service fees imposed on startups utilizing Google Play to feature their Android applications, and offering digital goods or services to users.

The division bench, comprising Chief Judge SV Gangapurwala and Judge PD Audikesavalu, not only upheld the single-judge bench’s ruling but also rejected a cross-appeal filed by Google, reported Lawbeat. However, recognizing the potential impact on mobile app owners, the court extended interim protection from app delisting on the Google Play store for an additional three weeks. This extension allows app owners the opportunity to pursue appeals before the Supreme Court, if necessary.

The crux of the matter lies in the enforcement of Google’s Play Billing System (GPBS), which became mandatory in 2020 for handling payments related to the download of paid apps and In-App Purchases. Indian startups argued that, in response to a Competition Commission of India (CCI) order issued on October 25, 2022, instructing Google to refrain from restricting app developers to third-party billing, Google introduced the “Alternative Billing System/User Choice Billing” alongside GPBS.

The startups alleged that Google, leveraging its monopoly in the Android market, was forcing app developers to comply with its payment policy. Despite these claims, the single-judge bench, in August of the previous year, ruled that the jurisdiction for the matter rested with the CCI. The judge also emphasized that remedies available under the Competition Act were more comprehensive than those offered in a civil court.

Undeterred by the single-judge bench’s decision, mobile app companies initiated appeals against it. The recent ruling by the division bench at the Madras High Court not only upholds Google’s innovative billing system but also underscores the jurisdictional importance of the Competition Commission of India in addressing such matters. The three-week reprieve granted to app owners offers a window for further legal recourse before the Supreme Court, signalling a continued legal tussle between app developers and tech giants over billing practices.