Google has banned those Korean developers who use third-party payment systems from updating applications

Google is unhappy with developers from South Korea. The company has banned updating applications that use third-party billing bypassing the store’s commission. However, such actions caused conflicts with the Korean government.

Recall that in August 2021, a law was issued in South Korea prohibiting the owners of stores from imposing a particular payment system on developers. As a result, local developers theoretically got the opportunity to bypass the 30% commission on each transaction.

At first, in response, Google and Apple allowed the use of third-party payment methods inside applications, also reducing the commission amount for them. For example, Google has reduced by 4%.

After the adoption of the law, Korean developers whose products are in the Play Store catalog also began to post links to third-party sites in applications where in-game content can be purchased.

Google Office in SeoulGoogle responded by banning the updating of such applications.

The company also threatened to remove them from the store by June 1.

However, the Communications Commission of South Korea (KCC) stated that such actions violate the law on payment systems. The commission is ready to launch investigations into violations and impose fines of up to 2% of the revenue of the Play Store in South Korea if Google continues to pressure.

KSS also intends to create a unit of local developers, which will record further violations of the adopted law.

According to local lawyers, the incident occurred due to a lack of specifics.

The law on payment systems does not mention external payment methods, including clicking on links, only a ban on imposing their own payment systems.

“The wording of the law is inherently vague,” said Chong Jung Che, an antitrust specialist.

Accordingly, Google could consider that the restriction applies only to purchases made inside the app itself, while the Korean government had in mind all forms of payments.

Earlier, South Korea’s law prompted regulators and governments around the world to pay close attention to the extensive influence of Google and Apple in their stores. For example, the European Union is preparing to approve the Digital Markets Act (DMA), which will force Apple to allow downloading third-party apps and stores.

Last week, Apple allowed subscription services such as Netflix, Spotify and Kindle to post links to their own websites where users can pay for a subscription.