Korea gives Google and Apple another kick for requiring their own payment systems
All your apps – or a percentage of revenue – are belong to us
South Korean has again imposed new regulations on app stores, this time with a regime that will see operators fined up to two per cent of revenue if they force their proprietary in-app payment systems on developers.
"Considering that certain payment methods compulsory acts are serious illegal acts of app market operators, an enforcement ordinance has been prepared that imposes a fine of two per cent of sales and one per cent of sales for delayed screening or deletion," the Korea Communications Commission (KCC), yesterday announced in a (Korean language) canned statement.
The new regulation follows the September 2021 introduction of the country's Telecommunications Business Act, which prevents tech giants from restricting payment options on their platforms – either to pay for apps or for in-app purchases. The Act also prevents the likes of Google, Apple and others from taking a cut of in-app purchases facilitated by third-party services.
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The Act was devised to curb anticompetitive behavior by those who regularly abused their dominant market positions in app stores. It all started when Epic Games filed a lawsuit against Google and Apple to secure the right to use alternative payment mechanisms in iOS and Android apps. The game developer felt the standard rate of 30 per cent was excessive and the inability to use its own payment offering was anti-competitive. Google and Apple have both backed down a little since then, with the ad giant complying with South Korea's new law.
Apple, on the other hand, has said it already complies – although government officials have a different interpretation of "compliance". The matter remains unresolved, which may be why South Korea has introduced these penalties. ®