South Korea has asked tech biggies Apple and Google to turn in their compliance plans to a new law by mid-October. According to a regulatory official, the law in question makes it illegal for operators of major app stores (primarily Apple’s App Store and Google’s Play Store), to force software developers to make use of their payment gateways while making transactions. The two companies have not issued any comment regarding the matter.
New Enforcement Ordinance Coming
South Korea’s Korea Communications Commission is all set to roll out an enforcement ordinance to accompany the amendment to the Telecommunications Business Act of the country. Most clauses of the new law came into effect around mid-September. The ordinance will probably be drafted within the next six months or even earlier, according to a regulatory official.
Misusing Power to Eliminate Competition
This news comes even after the Asian country had slammed Google with a fine worth 207.4 billion Korean won ($176.9 million) earlier this month, accusing it of misusing its dominant position in the mobile operating system market to indulge in anticompetitive practices.
The US-based tech biggie has been accused of blocking smartphone makers from using operating systems that are developed by its rivals, by forcing them into anti-fragmentation agreements (AFAs). The contracts apparently pertain to app store licenses, along with early access to the operating system, and prevents device manufacturers from installing modified versions of Android on their models.
Stifled Innovation, Or Promoted It?
Issuing the fine, the Korea Fair Trade Commission (KTFC) has alleged that Google “stifled innovation” through its questionable practices, and preventing new operating systems from being developed.
In its ruling, the watchdog has demanded that the company stop trying to force companies into signing AFAs, while also directing it to take corrective measures.
A spokesperson for the firm has said that Google has actually put in efforts to increase innovation in hardware and software development through its compatibility programme, contrary to what the authority has alleged. Issuing a statement to the effect, the spokesperson has said the KFTC has completely ignored the benefits of the company’s efforts, something that “will undermine the advantages enjoyed by the consumers,” while adding that the firm is seeking to appeal to the watchdog to repeal its decision.
At the same time, one may note that the fine which has been issued is quite measly as compared to Google parent Alphabet’s quarterly earnings, which stand at a whopping $61.88 billion.