South Korea Passes Bill Banning Apple From Requiring Developers to Use App Store In-App Purchase System

South Korea today passed a bill that bans Apple and Google from requiring developers to use their own respective in-app purchasing systems, allowing developers to charge users using third-party payment methods, The Wall Street Journal reports.

General App Store South Korea Feature Feature
The bill was originally supposed to be voted on yesterday, however, more urgent matters presented to South Korea's National Assembly meant the bill was postponed. The bill is an amendment to the existing Telecommunications Business Act. It aims to ban Apple and Google from unfairly exploiting their market position to "force a provider of mobile content, etc., to use a specific payment method."

Apple's App Store has been under increased scrutiny in recent months. South Korea's bill represents the first time any government has taken substantive legislative steps to crack down on the platforms. Lawmakers, developers, and others have called for increased regulation of both Apple and Google's app distribution services, noting the companies' potential to engage in anti-competitive behaviors.

Under the now passed bill, Apple in South Korea will no longer be permitted to limit developers to only use its in-app purchasing system, which grants it a 15% to 30% commission for all purchases made. The commission has been under the spotlight ever since game developer Epic Games attempted to bypass Apple's ‌App Store‌ policy by implementing a direct payment method for users last year.

Apple has called its in-app purchasing system a safe and secure way to allow users to purchase digital goods within apps, while some have called the company's commission unfair. As we noted yesterday, Apple operates its ‌App Store‌ under one set of rules applied to developers internationally. While South Korea's bill is specific to users in the country, it may have a domino effect worldwide.

Besides a 15% to 30% commission on all in-app digital purchases made, Apple charges developers a $99 annual fee to be part of its Apple Developers program. Those two revenue streams are just a few ways Apple maintains a profit for the ‌App Store‌. In the third quarter of this year, the tech giant reported an all-time high revenue record of $17.5 billion in its services business, including the ‌App Store‌.

Update: In response to the bill passing, Apple has provided MacRumors with the following statement. The statement, the same one used previously when asked on the legislation, says that user trust in the ‌App Store‌ will decrease as a result of the bill.

The Telecommunications Business Act will put users who purchase digital goods from other sources at risk of fraud, undermine their privacy protections, make it difficult to manage their purchases, and features like “Ask to Buy” and Parental Controls will become less effective. We believe user trust in App Store purchases will decrease as a result of this legislation — leading to fewer opportunities for the over 482,000 registered developers in Korea who have earned more than KRW8.55 trillion to date with Apple.

Top Rated Comments

dandbj13 Avatar
19 months ago
I strongly suspect this push to change Apple's App Store is not coming from Apple product users. It is coming from people on competitive platforms who want to take away Apple's competitive advantage. Despite that, Apple cannot just pull out of territories because more of these laws will be passed in other places. What they need to do is start trialing some of their countermeasures they have been working on for this eventuality. Developers believe they have won a free ride. I rather suspect they are in for a very different kind of ride.
Score: 33 Votes (Like | Disagree)
Marbles1 Avatar
19 months ago

Bye-bye, South Korea.
Now this virus has been released, let's see if other countries catch it.
As a customer, I don't want a hundred shops and pay-systems, I need one that has everything.
I nerver had a problem to be "forced" to Apple's in-App-System.
More chaos forced by lawmakers, silly.
Nothing is stopping you continuing to use Apple's payment system.

Just like nothing is stopping you using Safari, Pages, Calculator or any other app/service offered by apple.
Score: 29 Votes (Like | Disagree)
nyuszika7h Avatar
19 months ago

so what is the alternative? Apple and Google charging the developer for posting an app in their stores? I understand that the current system is not great, but I do want to have a store system, where there is some sort of oversight of the apps available.
They already do. Google’s fee is $25 one-time and Apple’s is $99/year.
Score: 23 Votes (Like | Disagree)
ghanwani Avatar
19 months ago
When I saw the post about the delay yesterday, I didn’t think it was only a 24 hour delay.
Score: 22 Votes (Like | Disagree)
cdarlington1 Avatar
19 months ago
Apple will still make their money from offering the platform to developers. If they can’t get paid from a % of purchases, they’ll just bill a different way. As they should.
Score: 20 Votes (Like | Disagree)
jonnysods Avatar
19 months ago
So it begins. I wonder what the future holds for Apple. Its a much easier road being the underdog, than being the top dog.
Score: 19 Votes (Like | Disagree)

Popular Stories

Apple Silicon Teal Feature

The Next Big Apple Silicon Device May Not Be a Mac or iPad

Wednesday February 1, 2023 3:57 am PST by
Apple's next device with an Apple silicon chip may not be a Mac or an iPad, but rather an advanced external display, according to recent reports. The display, which is rumored to arrive this year, is expected to sit somewhere between the $1,599 Studio Display and the $4,999 Pro Display XDR – but more exact information about the device's positioning and price point is as yet unknown. While ...
General iOS 16 Feature Yellow

Five New iOS Features Coming to Your iPhone Later This Year

Tuesday January 31, 2023 11:58 am PST by
Apple has previously announced several upcoming iOS features that are expected to be added to the iPhone this year. Some of the features could be introduced with iOS 16.4, which should enter beta testing soon, while others will arrive later in the year. Below, we have recapped five new iOS features that are expected to launch in 2023, such as an Apple Pay Later financing option for purchases ...
HomePod 2 White and Midnight Feature Purple Blue

Apple Explains Why HomePod Was Released Again, Wi-Fi 4 Limitation, and More

Thursday February 2, 2023 7:57 am PST by
Apple's VP of hardware engineering Matthew Costello and product marketing employee Alice Chan recently spoke with Men's Journal and TechCrunch about the new second-generation HomePod in wide-ranging interviews about the smart speaker. Apple discontinued the original full-size HomePod in March 2021 after multiple reports indicated that sales of the speaker were lackluster, but Chan told Men's ...
iOS 16

Apple Preparing iOS 16.3.1 Update for iPhone as Wait for iOS 16.4 Beta Continues

Thursday February 2, 2023 6:41 am PST by
Apple appears to be preparing an iOS 16.3.1 update for the iPhone, based on evidence of the software in our website's analytics logs this week. It's unclear when the update will be released, but it will likely be available at some point in February. The same logs have accurately foreshadowed the release of several previous updates, including iOS 16.0.3 and iOS 16.1.1 most recently, so they...
dewey airtag

Report Highlights Danger of Using AirTags for Tracking Dogs

Monday January 30, 2023 1:45 pm PST by
AirTags may be a convenient way for tracking dogs that might get off leash or otherwise lost, but there are dangers associated with the practice, as outlined by a report from The Wall Street Journal. At 1.26 inches in diameter, AirTags are able to fit easily on a dog's collar, but that size also makes the tracking devices small enough to swallow, at least for a medium to large-sized dog, and ...
MKBHD HomePod 2 White Ring Stain

New HomePod Can Still Stain Some Wooden Surfaces

Tuesday January 31, 2023 8:29 am PST by
When the original HomePod launched in 2018, it was discovered that the speaker can leave white rings on some wooden surfaces. Now, well-known YouTuber Marques Brownlee has confirmed that the issue persists to a lesser extent with the new HomePod. In a side-by-side test, he showed that the white second-generation HomePod left a white ring on the wooden surface that he placed the speaker on,...
Multi Display CarPlay 1

Apple Launching All-New CarPlay Experience Later This Year With These 5 Features

Sunday January 29, 2023 10:15 am PST by
In June 2022, Apple previewed the next generation of CarPlay, promising deeper integration with vehicle functions like A/C and FM radio, support for multiple displays across the dashboard, personalization options, and more. Apple says the first vehicles with support for the next-generation CarPlay experience will be announced in late 2023, with committed automakers including Acura, Audi,...
iOS 16

When Will the iOS 16.4 Beta Be Released?

Wednesday February 1, 2023 11:09 am PST by
It's been more than a week since Apple released the iOS 16.3 update, and typically, new iOS betas follow launches within a day or so. We were expecting Apple to provide the first beta iOS 16.4 on Monday, Tuesday or Wednesday of this week, but that hasn't happened. Tuesdays are the days that we most often see betas, though Monday and Wednesday happen now and then, and most often betas come...