India slaps `136cr penalty on Google
New Delhi: The Competition Commission on Thursday imposed a fine of 136 crore ` on internet giant Google for unfair business practices in the Indian market for online search.
In an order which can have international ramifications, Competition Commission of India ( CCI) has imposed a penalty of ` 135.86 crore on search engine giant Google for search bias.
The Competition Commission of India ( CCI) has found Google to have abused its dominant position in online general web search and web search advertising services in India. The penalty amounts to 5 per cent of Google’s average total revenue from India operations in the last three years. Globally, this is one of the rare cases where Google has been penalised for unfair business ways, even as it has been under probe in several countries.
CCI in its order said that 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. The competitors were denied access to the online search syndication services market due to such a conduct.
The order was passed in response to informations filed by Matrimony. com Limited and Consumer Unity and Trust Society ( CUTS) in 2012.
On the basis of the probe report submitted by the Director General, the CCI broadly looked at four aspects — whether Google biases its search results, whether it imposes unfair conditions on advertisers, whether the company’s distribution and intermediation agreements restrict competition.
CCI in its order noted that the allegations against Google in respect of search results essentially centred around design of Search Engine Result Page ( SERP). CCI said in its order that Google, being the gateway to the internet for a vast majority of internet users due to its dominance in the online web search market, is under an obligation to discharge its special responsibility. CCI noted in its order that Google through its search design has not only placed its commercial flight unit at a prominent position on SERP, it has also allocated disproportionate real estate thereof to such units to the disadvantage of verticals trying to gain market access. Besides, it was also found that Google has provided a further link in such commercial units which leads users to its specialised search result page ( Google Flight) resulting into unfair imposition upon the users of general search services as well. The CCI also noted in the order that ranking of Universal Results prior to 2010 were pre- determined to trigger at the 1st, 4th or 10th position on the SERP instead of by their relevance.
Such practice of Google was unfair to the users and was found to be in contravention of the provisions of Section 4( 2)( a)( i) of the Act. However, CCI noted in its order that since October, 2010, Google has made display of such results on free floating basis.
Accordingly, taking Google’s submission on record, CCI refrained from issuing any cease order.