South Korea finalizes rules forcing App Store to take third-party payments
Lawmakers in South Korea have agreed on rules for a law passed in 2021 that aims to change how the App Store and other digital storefronts are managed and payments handled, a law that will come into force by March 15.
In August 2021, the South Korean government voted to approve the Telecommunications Business Act, affecting Apple and Google's control of their respective app stores. On March 8, lawmakers have finally decided on rules that Apple and Google must abide by within the country.
The Telecommunication Business Act aimed to stop Apple and Google from forcing developers into selling apps via the App Store and the ensuing payment of commission. The intention was to prevent a forced exclusivity of the in-app payment systems, as well as limiting store operators from unreasonably delaying or deleting apps.
The rules, referred to as enforcement ordinance, state the law bars "the act of forcing a specific payment method to a provider of mobile content" by using the status of the app market's operator, a Korea Communications Commission statement seen by Reuters states.
The rules also bar actions such as unfairly delaying reviews of mobile content, as well as refusing, delaying, or limiting the registration, renewal, or inspection of content that uses third-party payment systems. In short, the law forces Apple and Google to accept third-party app payments in apps included in app stores.
KCC Chairman Han Sang-hyuk said "In order to prevent indirect regulatory avoidance, prohibited acts, types, and standards have been established as tightly-knit as possible within the scope delegated by the law."
Lawmakers have given Apple and Google ample time to prepare for the law's implementation, and to offer details of plans to follow the law. Apple submitted its plan in January 2022.
However, in February, a KCC official said Apple's plan "still lacks concrete detail." There has been no public progress since then.
Nailing down the rules of the law itself, gives Apple and Google just a week to prepare for its enforcement, as the law goes live on March 15. Failing to abide by the law could cost store operators fines as much as 2% of average annual revenue from related business activities.
Read on AppleInsider
In August 2021, the South Korean government voted to approve the Telecommunications Business Act, affecting Apple and Google's control of their respective app stores. On March 8, lawmakers have finally decided on rules that Apple and Google must abide by within the country.
The Telecommunication Business Act aimed to stop Apple and Google from forcing developers into selling apps via the App Store and the ensuing payment of commission. The intention was to prevent a forced exclusivity of the in-app payment systems, as well as limiting store operators from unreasonably delaying or deleting apps.
The rules, referred to as enforcement ordinance, state the law bars "the act of forcing a specific payment method to a provider of mobile content" by using the status of the app market's operator, a Korea Communications Commission statement seen by Reuters states.
The rules also bar actions such as unfairly delaying reviews of mobile content, as well as refusing, delaying, or limiting the registration, renewal, or inspection of content that uses third-party payment systems. In short, the law forces Apple and Google to accept third-party app payments in apps included in app stores.
KCC Chairman Han Sang-hyuk said "In order to prevent indirect regulatory avoidance, prohibited acts, types, and standards have been established as tightly-knit as possible within the scope delegated by the law."
Lawmakers have given Apple and Google ample time to prepare for the law's implementation, and to offer details of plans to follow the law. Apple submitted its plan in January 2022.
However, in February, a KCC official said Apple's plan "still lacks concrete detail." There has been no public progress since then.
Nailing down the rules of the law itself, gives Apple and Google just a week to prepare for its enforcement, as the law goes live on March 15. Failing to abide by the law could cost store operators fines as much as 2% of average annual revenue from related business activities.
Read on AppleInsider
Comments
- Monthly rental for shelf-space, the more shelf-space the higher the rental fee (e.g. instead of flat developer fees, class/tiered-basis should work better);
- % Commission of sales. the more sales the products generate the higher quantum;
- Sales targets - higher sales volume = lower % of commission;
- Each service required of supermarket staffs to perform/provide = more fees to pay (e.g. stacking/replenishing goods to the shelf when depleted).
Use of different identifier/sku to track which payment model each app uses and flows through the processes. Since more work less automation involved for using 3rd party payment, there can be various tiered service catalog model for different class/tier of developer account.On the Mac side of the house there are a few big payment agents that process payments for various developers outside the App Store. I’ve dealt with them and have had no issues so far.
I have been a big supporter of both the App Store payment system and the inability to side load but I’m not so sure anymore. The Mac has been this way since day one so why not iOS devices? The only problem is, if something goes sideways and customers get screwed, Apple will definitely get the blame and negative press coverage. We all should know that by now.
Apple will likely provide an API for developers ot inform Apple of the sales made outside of Apple’ in-app payment method - so that Apple can collect the 27% they are due.
Almost all developers will stick with Apple in-app payments for less hassle.