Hansanghyeok: "Google, Action Required for Disposition Even if There Is a Possibility of Illegality"

"Can't Prevent in Advance Even if Law Exists"
Broadcasting Commission Listens to Industry Complaints... Also Conducts Awareness Investigations

Sanghyuk Han, Chairman of the Korea Communications Commission

[Asia Economy Reporter Cha Min-young] On the 6th, Han Sang-hyuk, Chairman of the Korea Communications Commission (KCC), responded to questions about the possibility of Google violating the so-called 'Google Gapjil Prevention Act (Amendment to the Telecommunications Business Act)' and the KCC's measures by saying, "Even if we see a possibility of illegality, there must be an act for us to take action."

After the full KCC meeting on the afternoon of the same day, Chairman Han told reporters, "A violation must be revealed through an investigation," and explained, "The entire procedure must proceed before a judgment can be made."

He added, "An act must occur, and an investigation must be conducted on that act to confirm the facts and make a legal judgment," and said, "Whether to punish afterward or not, the law cannot prevent it in advance just because it exists."

The KCC issued an authoritative interpretation the day before, stating that "Google's mandatory in-app payment (using the app market operator's payment system) may correspond to 'forcing a specific payment method' under Article 50, Paragraph 1, Item 9 of the Google Gapjil Prevention Act." Since the 1st of this month, Google has enforced the in-app payment policy, prohibiting outlinks within apps that induce external payments. This effectively forced app developers to use the in-app payment system.

The KCC plans to verify violations through an on-site inspection and convert to a fact-finding investigation if violations are confirmed. A KCC official said, "It is unprecedented for the KCC to proactively state that there is a possibility of 'illegality' just because Google issued a policy," and added, "Rather than just waiting for reports, we will conduct on-site inspections and actively combine recognition investigations."

During the fact-finding investigation, if orders to resubmit materials are not complied with or corrective orders such as cessation of prohibited acts are ignored, the KCC plans to actively impose enforcement fines under the recently amended Telecommunications Business Act. To collect and analyze cases of damage to app developers, the 'App Market Unfair Practices Damage Report Center' will also be established. For identified damage cases, an 'App Market Damage Relief Support Group' composed of external experts in legal and technical fields will be formed.

Currently, the possibility that Google will readily admit to illegal acts is low. Google currently argues that it is not illegal by claiming that it has allowed external payments by app developers besides in-app payments, so there is a high possibility that this will escalate into administrative litigation. It is estimated that Google's annual revenue from in-app payment commissions in Korea reaches 850 billion KRW. The revenue is estimated to exceed 1.3 trillion KRW with the implementation of the new payment policy.