Visitors look at Apple Inc. iPhones and iPads. on display at the flagship store SK Telecom Co. T Factory in Seoul, South Korea, June 11, 2021.
SeongJoon Cho | Bloomberg | Getty Images
South Korea’s parliament has passed a bill that will make it the first country to impose restrictions on Google and Apple’s payment policies that force developers to use only proprietary billing systems from tech giants.
The legislation will become law once it is signed by President Moon Jae-in, whose party has been a supporter of the bill.
Apple and Google policies usually require developers to pay technology giants a 30% commission on each transaction.
The bill, passed Tuesday, means developers can avoid paying commissions to major app store operators, such as Google and Apple, by directing users to pay through alternative platforms.
A Google spokesman said its service fee “helps keep Android free, providing developers with the tools and global platform to access billions of consumers around the world.”
“We will reflect on how to comply with this law while maintaining a model that supports a high-quality operating system and app store, and we will share more in the coming weeks,” the Google spokesman added.
Apple did not immediately respond to CNBC’s request for comment.
According to Yonhap News, the law, sometimes referred to as the Anti-Google Act, was introduced in parliament last August.
About 180 of 188 lawmakers in attendance voted in favor of passing the amendment to the Telecommunications Business Act, Reuters reported.
Media reports said that last week the legislative and judicial committee of the National Assembly approved the revision of a bill aimed at preventing app store operators from forcing developers to use systems. specific payment.
Regulatory control
Regulators around the world are focusing more on app stores and the fees Google and Apple are charging developers, and the ruling in South Korea will likely be the first step toward greater control, according to Daniel Ives, director general equity research firm of Wedbush Securities.
“It’s a potential time for hydrographic division,” Ives told CNBC’s “Street Signs Asia” Monday ahead of the decision in Seoul. “Not necessarily because of what that means in itself, but because of the wavy effect, as it shows that they are not just words, but actually actions.”
Ives added that while there may be monetization opportunities for others, such as telecom service providers, it ultimately depends on how consumers would respond.
“The question is what will consumers ultimately do? Because the path of least resistance is to go through Apple and go through Google, and that’s what consumers have become accustomed to,” he said.