Google Antitrust Penalty Amount ‘Provisional’; CCI Awaits Requisite Financial Details

The Competition Commission’s penalty amount of Rs. 1,337.68 crore imposed on Google is “provisional” as the regulator has asked the internet major to furnish requisite financial details since the data was not presented in a reliable manner.

On Thursday, the watchdog penalised Google for abusing its dominant position in multiple markets in relation to Android mobile devices and also ordered the company to cease and desist from various unfair business practices.

The penalty of Rs. 1,337.76 crore translates to 10 percent of Google’s average of relevant turnover for the last three preceding financial years 2018-19, 2019-2020 and 2020-21.

According to the Competition Commission of India (CCI), Google has made significant upward revisions in the financial data presented vide its submission dated October 11, 2022, vis-a-vis that of December 17, 2021.

However, this data is still subject to multiple caveats, disclaimers, assumptions, exclusions, as per the regulator’s order passed on Thursday.

“The Commission takes a serious note of such glaring inconsistencies and wide disclaimers in presenting various data points by Google. The Commission is constrained to observe that despite commanding enormous resources, Google has failed to provide the data in the manner sought by the Commission despite the grant of sufficient time, as sought by it,” CCI said in the order made public on Friday.

In a statement on Friday, Google said it will review the CCI order and termed it as a “major setback” for Indian consumers and businesses.

As per the order, the sum total of revenue of various segments/ heads for the FY 2021-21 is higher than the total turnover of Google for the said financial year.

“Thus, taking a conservative approach at this stage, the Commission decides to take the lower revenue data, as submitted by Google vide its submission dated 11.10.2022, as relevant turnover for computation of quantum of penalty,” it noted.

In the 293-page order, the regulator said the aforesaid penalty amount is “provisional and subject to revision on Google furnishing the requisite financial details and supporting documents as sought by the Commission vide order dated 19.09.2022”.

The internet major has been asked to do the needful within 30 days from the receipt of the latest order.

“It is further clarified that the basis of determination of penalty i.e., relevant turnover as well as appropriate percentage thereof has already been decided vide this order.

“However, the actual quantum of penalty may undergo a revision based on revenue data to be submitted by Google and to that extent only, the present penalty is provisional,” it said.

“This clearly shows that data has not been presented by Google in a reliable manner. In this regard, it is observed that the Commission has given an unambiguous direction to Google that the data should be supported by certificates of Chartered Accountants. However, Google has not provided the same and rather has provided certificates of its own officers,” the regulator noted.

As against the claims of Google, CCI said it does not find any mitigating factor in the present matter, which would warrant a reduction in the penalty computation, rather there are aggravating factors viz the conduct on the part of Google is continuing unhindered at least since 2011.