NCLAT directs Google to deposit 10% of INR 137 crore penalty

The National Company Law Appellate Tribunal (NCLAT) on April 27, 2018, in an interim order, asked Google Inc to deposit 10% of the INR 136.86 crore penalty imposed on it by the Competition Commission of India (CCI) for abusing of its dominant position in “Online General Web Search and Web Search Advertising Services” markets in India through practices leading to search bias and search manipulation, while admitting the company’s appeal against the CCI order.

A bench headed by S.J. Mukhopadhyay and Justice Bansi Lal Bhatt further directed Google to keep displaying, as per the CCI order, a disclaimer in its Commercial Flight Unit box indicating clearly that the “search flights” link placed at the bottom leads to Google’s Flights page, and not the results aggregated by any other third-party service provider, so that users are not misled.

As reported here, the Competition Commission of India (CCI) on Feb 8, 2018 had imposed a fine of INR 136 crore on Google for unfair business practices in the Indian market for online search. The Commission had found that Google, through its search design, had placed its commercial flight search function at a prominent position on the search results page to the disadvantage of businesses trying to gain market access. The ruling had resulted from complaints filed by and Consumer Unity & Trust Society (CUTS)—back in 2012—against Google LLC, Google India Pvt Ltd and Google Ireland Ltd. Read order here.

The competition watchdog had noted that the prominent display and placement of Google’s Commercial Flight Unit with links to Google’s specialized search options/services (Flight) amounted to an unfair imposition upon users of search services as it deprives them of additional choices.

It was alleged that in order to promote certain search sites with which Google had a “vertical” business arrangement, Google started mixing many of these “vertical” results into organic results.

The penalty of Rs.135.86 crore translates into 5% of the firm’s average total revenue generated from its India operations for financial years 2013, 2014 and 2015, according to the CCI order.

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