South Korean Watchdog Finds Google and Apple Violated In-App Payment Law
Key Takeaways
- •The Korea Media Communications Commission said Google and Apple violated South Korean law in their app marketplace practices.
- •The case centers on a 2021 amendment banning app store operators from forcing developers to use only proprietary in-app payment systems.
- •After allowing third-party payments, both companies imposed roughly 26% fees on outside transactions.
- •The commission said the level of sanctions will be determined later, following an earlier warning of the maximum possible fine in October 2023.
- •The ruling adds momentum to wider global regulation of app store payment rules, including the European Union’s Digital Markets Act.
South Korea's media watchdog concluded Wednesday that Google LLC and Apple Inc. violated national laws by abusing their dominant positions in their respective mobile app marketplaces.
The Korea Media Communications Commission announced the finding during a regular meeting held in the afternoon. The commission said the specific level of sanctions will be determined at a later date.
The two US-based technology companies stand accused of circumventing a 2021 revision to South Korea's Telecommunications Business Act — widely regarded as the world's first law prohibiting major app store operators from forcing developers to use their proprietary in-app payment systems exclusively.
Following the amendment's passage, both Google and Apple began permitting users to make purchases through third-party payment gateways. However, they concurrently imposed a transaction fee of approximately 26 percent on purchases processed outside their native billing systems — a practice that drew sharp criticism for effectively undermining the legislation's intent. That fee rate closely tracks the commissions Google and Apple already charge on in-app purchases through their own systems, typically ranging from 15 to 30 percent depending on developer size and subscription duration, which opponents argue leaves developers with little meaningful alternative.
In October 2023, the watchdog issued a warning that it would impose the maximum permissible fine on the two companies. That punishment has yet to be carried out.
The decision marks a significant regulatory escalation in the long-running dispute over app store payment practices in one of Asia's largest technology markets. South Korea's 2021 legislative amendment has served as a reference point for similar regulatory efforts in other jurisdictions, including the European Union's Digital Markets Act, which began formal enforcement in 2024 and explicitly requires designated gatekeepers to allow app developers to steer consumers to alternative payment options without imposing retaliatory fees.
The investigation will now proceed to a sanctions phase, during which the commission is expected to determine formal penalties.
Source: Yonhap, via Korea Herald
