India's Competition Refree Asks Google To Explain Charges Of Unfair Market Practices

01/09/2015 2:19 PM IST | Updated 15/07/2016 8:25 AM IST
Hindustan Times via Getty Images
NEW DELHI, INDIA - MAY 25: Ashok Chawla, Chairperson, Competition Commission of India (CCI) during the 31st Annual Conference of Principal Chief Commissioners/Principal Directors General and Chief Commissioners/Directors General of Income Tax at Convention Hall, Hotel The Ashok on May 25, 2015 in New Delhi, India. Jaitley said that improvement in tax collection will increase the ability of the government to step up spending on social and infrastructure projects and provide relief to individual taxpayers. (Photo by Vipin Kumar/Hindustan Times via Getty Images)

Later this month Google may have to contemplate ways to tweak its search engine business and/or brace for a loss of a tenth of its income as fine, if India's top anti-trust body finds it guilty of manipulating search results. While this marks the beginning of a long-drawn legal altercation, this could be the most high-profile precedent-setting investigation involving the quasi-judicial Competition Commission of India (CCI).

The Economic Times has reported that Google has been asked by the investigating arm of the CCI to respond to allegations of unfair market practices by a slew of companies including Flipkart, Facebook, Nokia's maps division, and Bharat Matrimony. These companies have accused Google of unfairly promoting its own services and sponsored links by using its dominant position among search engines.

The Director General of the CCI has filed its own report asking Google to respond to these allegations by September 10 and, over the coming fortnight, be ready to be quizzed by a seven-member commission headed by Chairman Ashok Chawla. Google as well as the querulous companies have engaged top law firms and so proceedings can go on for several hearings before the commission makes a decision, which can be challenged in the Supreme Court.

In its report the commission's finds Google liable on promoting its own links, even if other websites are more popular. Thus a search for stock market-related information might on Google promote Google Finance over other sites such as The second barb is that sponsorship--not relevance--determines users being led to a particular link.

Google has told the Economic Times that the search-giant's internal reviews have found no instances of wrongdoing. "We're currently reviewing this report from the CCI's ongoing investigation," a Google spokesman said in an email to ET. "We continue to work closely with the CCI and remain confident that we comply fully with India's competition laws. Regulators and courts around the world, including in the US, Germany, Taiwan, Egypt and Brazil, have looked into and found no concerns on many of the issues raised in this report."

The allegations against Google, though a first for India, aren't new to it from other parts of the world. In April, the European Commission formally charged Google with violating EU competition law by abusing its dominance in search to gain an edge over niche rivals with the Zdnet reporting that "...The search giant could face fines of up to $6.4 billion, or approximately 10 percent of its global revenues..."

Antitrust regulators in the U.S. wrapped up a probe into Google's practices in 2013 without requiring that the company make any major changes to how it ranks websites.

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