The deadline for Google and Apple to submit written opinions on corrective measures proposed by the Broadcasting and Communications Commission (KCC) regarding their “coercive use of their own in-app payment systems” has been extended once again. After Google lost a first-instance lawsuit in the United States over its in-app payment system, all eyes are on whether Google will take corrective measures in South Korea. The company has publicly announced its intention to change Google Play’s policies, raising expectations for its response in the Korean market.
According to information technology (IT) industry sources, on the 21st, KCC announced that the previous day Google and Apple had requested an extension of the deadline for submitting comments on corrective measures related to mandatory in-app payments. KCC has granted this extension and will provide it until the end of the year.
Initially, the deadline for operators to submit comments regarding corrective measures was set at the beginning of this month. However, Google and Apple requested an extension, citing time-consuming procedures such as document review and reporting to the U.S. headquarters. Therefore, the deadline has been extended to December 20th.
The case stems from Google’s announcement in 2020 of a “mandatory in-app payment system” policy that mandates the use of in-app payment methods that charge up to 30 percent fees. In response, app developers opposed this forced in-app payment approach. Subsequently, the National Diet amended the Telecommunications Business Act in 2021, prohibiting the compulsory enforcement of in-app payment systems.
As a result, Google last year proposed a method of “third-party payments within in-app systems.” This approach allows for a variety of payment methods other than in-app payments, but requires a payment system to be built within the app.
However, this incurs additional fees for app developers and increases the overall cost compared to Google-mandated in-app payment systems. This seemed like a loophole and caused controversy, but Google remained adamant about its implementation. Apple also adopted a similar payment method last July.
Amid mounting criticism that it undermines regulatory measures, KCC began investigating unfair practices such as the mandatory in-app payment system in August last year. Following the investigation, the company announced on October 6 that it would impose a fine of up to 68 billion won (US$52.23 million).
The KCC found that Google and Apple violated provisions of the Telecommunications Business Act by abusing their dominant trading position, forcing specific payment methods, and unreasonably delaying app review. We have notified Google and Apple of corrective actions for these violations.
At the time, both companies expressed their disagreement with KCC’s position. Apple said, “We disagree with the findings released by KCC and believe it is in compliance with the Telecommunications Business Act,” adding, “We will continue to share our opinions through dialogue.” Google said it would “carefully consider any corrective action and submit comments. Upon receipt of the final written decision, we will carefully consider the direction of our response.”
If Google and Apple formally submit their opinions by the end of the year, the KCC will consult with Kim Hong-il, chairman of the Anti-Corruption and Civil Rights Commission (ACRC), and take necessary procedures such as a report and general meeting. It’s going to pass. , became KCC chairman. Following these steps will complete the corrective action.
Meanwhile, Google recently reached an agreement to pay a $700 million (911.4 billion won) settlement to the government and consumers and drop an antitrust lawsuit related to a similar case in the United States. Google recently faced a setback in a first-instance lawsuit brought by game developer Epic Games. Google appears to have chosen to settle the case, based on the assessment that this ruling would set a precedent for other antitrust lawsuits and could result in significant damages in civil litigation.
Additionally, Google announced that it will allow app developers to use their own payment systems within the in-app payment process, simplifying the process for users in the United States to download apps directly from developers.