Google Loses Rights to in-app Payments in South Korea

Google cannot penalize South Korean app developers for providing payment bypass. South Korea passed a new-payment law, the first of its kind in the world. The in-app payment of Google forces users to use a specific method of payment, which makes it difficult to provide alternative payment options. The country also plans to create a new unit for local app developers to report any violations of this law.

South Korea became the first country to pass a bill that challenges Google and Apple Inc’s dominance over the payment methods on their platforms. The law prohibits Google and Apple from forcing apps to use their in-app payment systems.

This could influence other global regulators to come up with measures to deal with the in-app payment of these tech giants. The app store law of South Korea took effect in September last year. Google and Apple are still trying to come up with a compliance plan that would satisfy regulators. 

Google is reviewing KCC guidance and will seek ways to continue investing in the Android ecosystem while working with local app developers in order to expand user choice. It would still apply fees on in-app payments, which could be as low as a 6% commission for an e-books provider or as high as 26% for popular mobile game applications. 

However, Apple which charges a 30% commission globally for in-app purchases, has yet to make policy changes in line with South Korean regulations. The KCC recently said that the Cupertino, California based company has signalled a will to comply.