South Korea has approved certain rules that will allow the government to ban app stores by Apple and Google from forcing software developers to use their payments systems.
For those unaware, the Cupertino and Search Engine giant have been facing scrutiny across the globe over their app stores. At the moment, both brands hold a duopoly in the market with most smartphone users using either of the two stores for apps. However, the two companies also charge take a share from any transaction made within apps from developers and did not allow for third party payment methods. Thus, telecom regulators in nations like South Korea have been targeting the Google Play Store and iOS App Store.
South Korea has recently passed a new law, an amendment to the Telecommunication Business Act, which will help remove the dominance held by Apple and Google. Both firms typically charge 30 percent on developers, but the new rules that are called enforcement ordinance will help developers bypass this charge. The new rule will be put into effect starting from March 15 and bars “the act of forcing a specific payment method to a provider of mobile content.”
Han Sang-hyuk, chairman of Korea Communications Commission (KCC) added that “In order to prevent indirect regulatory avoidance, prohibited acts’ types and standards have been established as tightly knit as possible within the scope delegated by the law.” So now, any infractions may reach as high as 2 percent of an average annual revenue from related business practices, as per the new rules.
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