Korea Delays Vote on Google & Apple In-App Payment Ban

South Korea's Move to Regulate App Store Commissions

Increased oversight of the policies governing in-app purchase charges set by Apple and Google is currently unfolding, with a notable development occurring in South Korea.

Landmark Bill Passes Committee

A significant bill was approved by South Korea’s parliamentary committee on Wednesday, August 25th. This legislation aims to prevent Google and Apple from levying commissions on in-app purchases made by software developers. It represents the first such measure globally.

The final vote by all members of the National Assembly, necessary for the proposal’s enactment, has been postponed indefinitely, despite initial expectations for a plenary session on the same day.

Reports indicate a tentative rescheduling of the plenary session to August 30th.

First Country to Prohibit Imposed Billing Systems

Should the bill become law, South Korea will be the pioneering nation to explicitly prohibit these major technology companies from mandating their own billing systems for in-app transactions.

The bill, often referred to as the “Anti-Google law”, received approval from the National Assembly’s legislation and judiciary committee. It seeks to amend the Telecommunication Business Act, thereby restricting Google and Apple’s ability to require developers to utilize their payment platforms.

Google's Previous Actions and Adjustments

In September 2020, Google announced its intention to implement its billing system across all app developers, intending to collect commissions of up to 30% on all in-app purchases.

Following requests from developers, Google subsequently deferred the implementation of this new billing policy until the end of March 2022. Furthermore, the Play Store commission was reduced to 15%, as reported by local news sources.

Apple's Concerns Regarding the Bill

Apple released a statement expressing concerns that the proposed Telecommunications Business Act could expose users to increased risks of fraud and compromise their privacy.

The company also argued that managing purchases would become more difficult, and features like ‘Ask to Buy’ and Parental Controls would be diminished in effectiveness. Apple believes this proposal could erode user trust in App Store purchases, potentially impacting the earnings of the over 482,000 registered developers in Korea who have collectively earned more than KRW8.55 trillion through the platform.

Arguments for Maintaining Current Systems

Both Apple and Google maintain that their in-app payment systems contribute to a more secure and enhanced user experience. This argument forms the core of their opposition to the proposed legislation.

Google has not yet issued an immediate response to the latest developments.