SEOUL – Apple Inc was on a collision course with South Korea on Friday over new demands to stop forcing app developers to use its payment systems, with official government warning of possible investigation on iPhone manufacturer compliance.
This development comes after South Korea amended the Telecommunication Business Act in August in an attempt to curb the market dominance of tech majors and prevent large app store operators such as Apple and Alphabet Inc Google from charging commissions on in-app purchases.
The law went into effect last month, but Apple had told the South Korean government that it was already complying with it and did not need to change its app store policy, an official told Reuters. the Korean Communications Commission (KCC) in charge of the case.
APPLE IS STUDYING THE POTENTIAL OF AIRPODS AS A HEALTH DEVICE
“This defeats the purpose of the amended law,” the official said, requesting anonymity, as the KCC was still in talks with Apple about compliance.
The regulator would ask Apple’s South Korean unit for a new company policy giving greater autonomy in payment methods, and if Apple did not comply, would consider measures such as an investigation by investigation as a precursor to possible fines or other sanctions.
Apple did not immediately respond to a request for comment.
Google had informed the KCC that it planned to comply with the law, including allowing third-party payment systems, and would discuss the matter with the regulator starting next week, the KCC official said.
Google did not immediately respond to a request for comment from Reuters.
Jung Jong-chae, an antitrust lawyer, said Apple had more to lose than Google because of Korean regulations.
CLICK HERE TO LEARN MORE ABOUT FOX BUSINESS
“The differences between Apple and Google in the willingness to give ground may be due to the fact that Apple controls everything from the hardware to the operating system (OS), including the application market and the payment system,” said he told Reuters.
“And (Apple) has more to lose if its dominance is shattered on any front, which could lead to calls for openness on other fronts.”