Today, a parliamentary committee in South Korea passed a bill that would prevent Google and Apple from forcing their payment systems onto app developers and taking commissions on in-app purchases. The bill still has to go up for a final vote, but if it goes through, South Korea will become the first country in the world to impose such a restriction on Google and Apple. The legislation comes after the US Senate proposed a similar bill.
The proposed law is a revision of the Telecommunications Business Act, making app store operators unable to force developers to use specific payment systems, such as those controlled by the app store operators.
All developers on Apple’s iOS app store have to run in-app payments through Apple’s payment system, from which it usually takes a 30 percent cut. The current legal showdown between Epic Games and Apple started when Apple banned Fortnite from iOS for letting players pay for in-app purchases without going through Apple. In March, Epic presented evidence in that case of the extent to which Apple will go to make sure certain big companies like Netflix keep giving it a cut of payments made on iOS.
Last year, Google similarly announced it would start more tightly enforcing requirements to use its billing system when distributing apps on Android’s Google Play Store, charging a 30 percent commission fee. According to The Korea Times, this new bill was initially submitted to the South Korean parliament as a direct response last year and is known as the “Anti-Google Law.”
The final vote was supposed to proceed today, but TechCrunch reports regulators delayed it until August 30th.
“The proposed Telecommunications Business Act will put users who purchase digital goods from other sources at risk of fraud, undermine their privacy protections, make it difficult to manage their purchases, and features like ‘Ask to Buy’ and Parental Controls will become less effective,” Apple said in a statement. “We believe user trust in App Store purchases will decrease as a result of this proposal—leading to fewer opportunities for the over 482,000 registered developers in Korea who have earned more than 8.55 trillion won to date with Apple.”
Apple is likely referring to cases in which people, often children, have mistakenly spent large amounts of money on in-app purchases. Apple’s statement suggests that if developers can use payment systems that sidestep its gates and parental controls, cases like this could get worse.
Earlier this month, the US Senate introduced the Open App Markets Act, which seeks to bar app store operators from forcing their billing systems onto developers and lets users sideload apps into devices.