Controversy Over the Effectiveness of the 'Google Gapjil Prevention Act'... Political Circles Moving Again

[Asia Economy Reporter Kang Nahum] As Apple follows Google in imposing high commission rates on third-party payment methods, sparking renewed controversy over the effectiveness of the 'Google Gapjil Prevention Act,' voices from both ruling and opposition parties are calling for legislation with strong regulatory measures, drawing attention to whether the current law will be amended.

◆Ruling and Opposition Agree "Google and Apple Are Violating the Law"=According to political circles on the 4th, the Korea Institute of Criminology and Justice Policy, a government-funded research institute, recently submitted an opinion to the office of Yoon Doohyun, a member of the People Power Party, stating that Google's forced in-app payment policy violates the current Telecommunications Business Act amendment (Google Gapjil Prevention Act) and the Fair Trade Act. This was in response to a request from Yoon's office to review whether 'app market operators' forced in-app payments and platform operators' forced payment methods' violate current laws.

The institute pointed out, "Current laws explicitly specify prohibited acts where app market operators unfairly use their transactional position," and stated, "Forced in-app payments and payment methods violate the Telecommunications Business Act and its subordinate statutes."

It added, "Even if app market operators allow third-party payment methods within the in-app payment system so that users can choose their payment method, acts that technically restrict or procedurally complicate the use of other payment methods are included in the 'prohibited acts' under the enforcement decree."

The institute further noted, "Google's or Apple's forced in-app payment policies constitute abuse of market-dominant position under the Fair Trade Act and have the same issues as the past 'Microsoft (MS) bundling' case." The 'MS bundling' case refers to Microsoft selling its computer operating system Windows bundled with MSN Messenger and other software.

Earlier, the opposition party also presented a similar interpretation. Ahn Jungsang, the senior policy advisor for media and ICT in the Democratic Party, pointed out in a report titled 'Review of Google's Rejection of the Forced In-App Payment Ban Law' that "Contrary to Google's claim that it did not violate the law, the enforcement decree includes 'acts that make it more difficult or inconvenient to access or use other payment methods compared to a specific payment method, thereby forcing a specific payment method,' which constitutes an illegal prohibited act."

Ahn emphasized the need to secure the effectiveness of the forced in-app payment ban through legislative supplementation. He said, "The enforcement penalty and fines should be significantly increased," and stressed, "The introduction of a 'temporary suspension order system,' which issues a 'temporary suspension' order to block the app market temporarily when acts that increase user burden continue even after corrective orders, should also be considered."

◆The Ball Is in the Korea Communications Commission's Court=With both ruling and opposition parties presenting similar interpretations, there is a high possibility that legislative supplementation procedures will begin if Google and Apple's 'trick' behaviors continue. A likely measure is to elevate the prohibited acts clause in the enforcement decree to the main law to increase the level of sanctions.

Ultimately, additional legislation depends on the Korea Communications Commission's (KCC) enforcement power. Currently, the KCC is conducting an inspection of damages caused by forced in-app payments. If appropriate regulations are not imposed based on the inspection results, it is expected that the political circles will once again initiate legislative procedures.

Currently, political circles are demanding proactive responses from the KCC. Lawmaker Yoon said, "Laws and systems are meaningful only when actively enforced," adding, "Since the people ultimately suffer from violations of the law, the Korea Communications Commission needs to respond more swiftly and actively."

Advisor Ahn also criticized, "The KCC's stance of just waiting for reports to be filed is irresponsible," and urged, "They should make more active efforts to comply with domestic laws through negotiations and persuasion with Google's headquarters."