South Korean parliament committee votes to curb dominance of Google and Apple committee

A 3D printed Google logo is placed on the Apple Macbook in this illustration taken April 12, 2020. REUTERS/Dado Ruvic/Illustration/File Photo

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SEOUL, Aug 25 (Reuters) – A South Korean parliamentary committee voted on Wednesday to recommend changing a law, a key step towards banning Google and Apple from forcibly charging software developers commissions on purchases integrated, the first brake of this type imposed by a great economy. .

Apple Inc (AAPL.O) and Alphabet Inc (GOOGL.O) Google have come under global criticism for requiring software developers using their app stores to use proprietary payment systems that charge commissions of up to at 30%.

In a statement on Tuesday, Apple said the bill “will expose users who purchase digital goods from other sources to the risk of fraud, undermine their privacy protections,” harm users’ trust in App Store purchases and reduce opportunities for South Korean developers.

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Wilson White, senior director of public policy at Google, said “the rushed process did not allow for sufficient analysis of the negative impact of this legislation on Korean consumers and app developers.”

Experts said app store operators could keep payment systems other than their own safe by working with developers and other companies.

“Google and Apple aren’t the only ones who can create a secure payment system,” said Lee Hwang, a professor at Korea University’s law school who specializes in competition law.

Others noted that South Korea has some of the strongest legal protections for online transactions in the world, and said app store operators should provide advanced services to boost profits.

“Dominant app store operators with large platforms should now seek to take advantage of value-added services, not just take a share of the apps sold on their store,” said Yoo Byung-joon, a professor at the Seoul National University School of Business specializing in e-commerce.

Based on South Korean parliament records, the amendment prohibits market-dominant app store operators from imposing payment schemes on content providers and “inappropriately” delaying review or the removal of mobile content from application markets.

It also allows the South Korean government to require an app market operator to “prevent harm to users and protect users’ rights and interests”, probe app market operators, and arbitrate disputes over payment, cancellations or refunds in the app market.

After the Legislative and Judiciary Committee vote to amend the Telecommunications Business Law, dubbed the “Anti-Google Law”, the amendment will go to a final vote in parliament.

That vote was due to take place on Wednesday, but the session has been provisionally postponed to August 30, a parliament official told Reuters. Read more

This month in the United States, a bipartisan group of senators introduced a bill that would curb the app stores of companies they believe have too much control over the market, including Apple and Google. Read more

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Reporting by Heekyong Yang and Joyce Lee; Editing by Gerry Doyle and Kim Coghill

Our standards: The Thomson Reuters Trust Principles.

Aurora J. William