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Google v Yandex anticompetitive battle in Russia

Why Yandex claimed? Producers of smartphones and pads with OS Android, who installed Yandex’s apps and default search service, refused to work with Yandex. Yandex believed Google create conditions to make producers refuse from cooperation with Yandex. Google believed it has not breached law protecting competition. Yandex stated that Google is owner of OS Android necessary for functioning of mobile devices. According to Yandex, Android’s market share in Russia is more than 50% since 2012. Google is also owner of Google Play which allows searching, acquiring, downloading and updating apps on mobile devices with Android OS. Producers of mobile devices have strong interest to install OS Android for marketing purposes. As a result without Google Play you can’t download most of apps. Google also requires installing Google Search by default. Google has developed its system including Google Play and other tools for mobile devices, but Yandex did not do the same in Google’s scale. Yandex suffered damages thanks to Google’s practice.

OS Android can work independently of Google’s apps. Google bears expenditures on developing and updating OS Android and apps, Yandex doesn’t do it. Besides, OS Android allows end users to turn off pre-installed apps, change initial setting, download and install competing apps. There are two types of Android – Android Open Source Project (AOSP) without GMS packer (is not popular) and Android with GMS packet (very popular). GMS – Google Mobile Services. Committee has mentioned that Google Play is provided only to producers of mobile devices. End users of mobile devices have no opportunity to download Google Play independently from any source. So it means they cannot use it without its pre-installation. With Google Play it is impossible to download app stores of other developers. Other technical details are available in decision.

After considering the case, committee has decided that GMS is no single object of intellectual property (it is not software complex, one program, composite work or multimedia product) and Google’s restrictions are beyond of its exercising of exclusive rights in separate Google’s apps. Each certain software is an object of intellectual property rights and their exercising covers only use of such software, but does not cover commercial activity related to such exercising. Subject of licence agreement can include only description of limits how program can be used. Any other issues of parties’ legal relationships, which also can be regulated by licence agreement, will be beyond of legal relationships within the scope of licence agreement. Google asserted it has provided manufacturers with right to use certain trademarks, but did not prove registration of it (registered grant of right to use certain trademark). Under Russian law without registration the grant of right to use trademark is to be considered as void, therefore there cannot be exercising of exclusive rights in any trademark.

Russian Google ltd, incorporated in Russia did not infringe Russian law protecting competition. But activity of Google Inc. and Google Ireland Limited, having dominant position in market of pre-installed app-store for OS Android localised for distribution in Russia, leads to restriction of competition in related goods market (app-stores) and such activity is to be considered under part 1 article 10 of the Law about protection of competition. Google has to cease infringement of article 10 of law protecting competition. Google also must undertake all actions necessary to change all agreements in accordance with FAS’s decision. Google Inc. and Google Ireland Limited must report to FAS how they executed this FAS’s decision.