South Korea’s Cabinet approves revised enforcement decree on in-app payment law

The revised enforcement decree is scheduled to take effect on March 15.

Seoul: South Korea’s Cabinet has approved a revised bill that would ban app store operators from forcing developers to use their own in-app payment systems, the country’s telecommunications regulator said.

The revision is a follow-up to the enforcement decree of the Telecommunications Business Act that went into effect in September, which made South Korea the first country in the world to introduce such curbs on in-app billing policies of Apple and Google.

Under the revised enforcement decree, app store operators will have to pay up to 2 per cent of their revenue for forcing developers to use their own in-app payment systems, and 1 per cent for delays in reviewing apps, according to the Korea Communications Commission (KCC), reports Yonhap news agency.

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App store operators will also be prohibited from preventing app developers from promoting an alternative payment system, as well as imposing unfair restrictions on app developers using third-party payments systems.

The revised enforcement decree is scheduled to take effect on March 15.

The in-app payment law came amid growing global scrutiny against Google and Apple, which maintain a strong grip over mobile ecosystems, for requiring developers on their app stores to use their proprietary payment systems that charge fees of up to 30 per cent when users purchase digital goods within apps.

Google pledged in November to provide an alternative payment system on its app store in South Korea at a slightly reduced service charge.

In January, Apple also said it will provide an alternative payment system at a reduced service charge compared with the current 30 per cent charge in compliance with the new law.

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