Korea fines Google, Apple over app payments

South Korea’s Korea Media and Communications Commission (KMCC) has fined Google and Apple a combined 63.7 billion won for their app store payment and review practices. The penalties target behavior the regulator concluded violated the Telecommunications Business Act, which bars app market operators from requiring specific payment methods.

Google received a fine of 42.9 billion won, while Apple was ordered to pay 20.81 billion won. The decision marks the first enforcement of provisions introduced in 2021 that prohibit operators such as Google and Apple from forcing the use of their own in-app payment systems.

The KMCC found that Google and Apple abused dominant positions in their app markets by effectively forcing developers to use designated in-app payment systems. Both companies allowed only their own payment tools and limited third-party options while imposing a 26 percent commission and what the regulator described as unreasonable conditions on third-party payments.

The commission concluded that these terms made it difficult for developers to choose alternative payment methods. It also determined that Apple charged different commission rates to domestic and foreign developers and had charged South Korean developers higher commissions than developers in other countries between 2015 and January 2023.

Beyond payment rules, the regulator cited unfair app review processes by both companies. The KMCC said Google and Apple at times delayed app reviews without giving developers clear reasons for the delays or information on when reviews would resume.

These delays were viewed as contributing to the abuse of dominance in the app store markets, affecting local developers’ ability to operate and update their apps in a predictable manner.

Alongside the fines, the KMCC issued corrective orders but decided not to file criminal complaints. Google and Apple must allow app developers to offer alternative payment methods, including links directing users to external payment websites from within apps.

The regulator also ordered the companies to revise their commission structures and adjust fees for third-party payment systems to levels it deems reasonable. Both firms are required to submit compliance plans within one month of receiving the orders and to implement the mandated changes within three months.

Google expressed regret that the KMCC’s ruling did not fully reflect its efforts to comply with the law and support Korean developers. In March, Google had announced plans to allow external payment options and to lower service fees, with changes scheduled to take effect at the end of the year, though these plans were not factored into the regulator’s decision.

Apple stated that it does not agree with the KMCC’s findings and highlighted that more than 90 percent of revenue generated through its App Store ecosystem returned to developers last year. The company said it believes changes implemented so far comply with the Telecommunications Business Act and that it is reviewing its next steps under Korean law.