Indonesia investigates Google over App Store payment system

(File photo) An image taken on October 18, 2021 in Moscow shows the logo of the US multinational technology and internet-related company Google on a tablet screen. (Photo by Kirill Kudryavtsev/AFP)

Jakarta, Indonesia (AFP) – Indonesia has launched an antitrust investigation into Google over the tech company’s insistence that its payment system be used for purchases from its App Store, authorities said Thursday, accusing it of unfair business practices.

The US Internet giant is under legal scrutiny in a number of countries for requiring the use of the billing system by all buyers on Google Play.

Authorities in Jakarta said in a statement that they suspect “Google abused its dominant position by imposing conditional sales and discriminatory practices in the distribution of digital applications in Indonesia.”

Google Play is the largest app distribution platform in Indonesia, a country of about 270 million people.

Third-party developers who display their apps on Google Play are charged a service fee of 15 to 30 percent, higher than the five percent charged by other payment systems, according to a preliminary investigation by the country’s antitrust agency.

“Relevant developers cannot refuse to comply because Google can impose penalties by removing their apps from the Google Play Store and prevent them from making updates to their apps,” the agency said.

Google Indonesia said Friday that it will work with Indonesian authorities “to clarify how Google Play supports developers.”

It added that since early this month, it has started a beta billing system, allowing an alternative payment system alongside the one used on Google Play.

The US multinational has faced a barrage of legal cases in the US, Europe and Asia based on similar accusations.

Google has also faced allegations that it has unfairly imposed its Chrome search engine and browser on phone makers using the Android operating system.

On Wednesday, the European Union’s second highest court ruled that “Google has imposed illegal restrictions on manufacturers of Android mobile devices”.

The court upheld a record EU fine of more than four billion euros ($4 billion) against Google

The case was the third of three major cases brought against Google by EU competition czar Margrethe Vestager, whose legal challenges were the first worldwide to confront Silicon Valley’s tech giants head-on.

South Korea fined Google nearly $180 million last year for abusing its dominant market position in a similar Android case.


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