South Korea Fines Google and Apple for App Store Practices
SEOUL, South Korea – On Wednesday, South Korea imposed fines totaling 63.7 billion won (approximately $47.6 million) on Google and Apple, accusing both companies of misusing their dominant positions in the app store market. The fines stem from allegations that they compelled local developers to utilize their proprietary payment systems and engaged in unfair delays during the app review process.
The Korea Media and Communications Commission, which oversees media and telecommunications in the country, conducted an extensive investigation into the two U.S. tech giants. This investigation focused on potential breaches of a 2021 law forbidding app store operators from mandating specific payment platforms for developers.
As part of the ruling, Google faced a fine of 42.9 billion won ($32 million), while Apple was fined 20.8 billion won ($15.5 million). Both companies were directed to allow South Korean developers to incorporate external payment links in their apps and to enhance their app review procedures.
In response to the ruling, Apple expressed disagreement, stating that it believes its current practices align with South Korean law. The company indicated it is reviewing its legal options, emphasizing that its in-app payment system is designed to secure transactions and protect users from potential fraud and predatory practices—safeguards it argues may be jeopardized with alternative payment options.
Google has not yet provided a comment regarding the fine.
The commission reported that both Google and Apple exerted undue pressure on app developers to use their in-app payment systems while restricting alternatives from external websites. Although developers could technically use third-party payment systems, they faced a hefty 26% commission fee and were denied access to certain features available in the companies’ native systems, effectively compelling them to stick with in-app payments.
Additionally, the commission found instances where app reviews were postponed without clear explanations, leaving developers in the dark about the reasons for delays or the timeline for resuming reviews. It was also pointed out that Apple had charged South Korean developers higher commission rates compared to those in other regions between 2015 and January 2023.
South Korea’s scrutiny of foreign tech firms is not new. The nation had previously made headlines in 2021 by being the first to pass legislation banning app market operators like Google and Apple from enforcing their own in-app payment systems.
