South Korea Fines Google and Apple $45 Million Over App Payments
South Korea has imposed combined fines of 63.71 billion won on Google and Apple over their app-store payment practices, escalating a long-running dispute over how developers charge customers for digital services. The country’s media and communications regulator also ordered both companies to make alternative payment options more accessible and revise conditions applied to third-party payment systems.
The penalties announced on October 28 amount to 42.9 billion won for Google and 20.81 billion won for Apple. Together, they are worth approximately US$45 million, based on the regulator’s reported conversion. The decision marks the first enforcement action under South Korea’s rules prohibiting app-market operators from forcing developers to use specific payment methods.
Why the Regulator Took Action
The Korea Media and Communications Commission said the companies had restricted developers’ practical ability to choose how customers paid for purchases made inside apps.
Although Google and Apple had permitted certain third-party payment options, the regulator found that these alternatives came with a 26% commission and conditions that made them less attractive or harder to use. In the commission’s assessment, these arrangements effectively encouraged developers to rely on the companies’ own payment systems.
The investigation also examined delays in app reviews. The regulator said developers were not always given specific explanations for delays or clear information about when outstanding reviews would be completed.
Apple faced an additional finding concerning how it calculated commissions for domestic and foreign developers. The commission concluded that its different treatment of the two groups breached South Korean law.
What the New Orders Require
The regulator has directed both companies to make it genuinely possible for developers to offer alternative ways to pay, including links within apps that take customers to external payment services.
They must also review the fees charged when developers use third-party payment systems and make the required changes to their policies and procedures.
Google has been ordered to revise its user-experience guidelines for alternative payments. Apple must address its requirement that developers submit a separate app when introducing third-party payment options.
Both companies must submit compliance plans within one month of receiving the corrective orders and complete the required improvements within three months. The regulator said it would monitor implementation. It did not announce criminal complaints against either company as part of this decision.
How South Korea’s Law Changed the App Store Debate
South Korea amended its Telecommunications Business Act in 2021 to prevent app-market operators from requiring developers to use particular in-app payment systems. The legislation attracted international attention because Google and Apple operate major app distribution platforms and have historically collected commissions on many digital transactions made through them.
The law was intended to give developers greater choice and address concerns that control over app distribution could be used to influence how digital purchases are processed.
However, allowing an alternative payment method does not automatically make it commercially practical. If developers face substantial commissions, complicated approval requirements or restrictions on how they communicate payment choices to customers, they may have little incentive to switch.
The regulator’s latest decision focuses on this gap between formally permitting alternatives and making them usable in practice.
What It Could Mean for App Developers
For developers, the changes could create greater flexibility in how they handle subscriptions, digital goods and other purchases made through mobile applications. Businesses may be able to compare payment providers and decide whether external checkout options offer meaningful savings or better customer experiences.
The actual benefit will depend on the final fee structures, payment-processing costs, security requirements and the steps customers must follow to complete transactions. Third-party payment providers may charge their own fees, so developers will need to assess the total cost rather than simply compare headline commission rates.
Smaller developers could benefit from additional choice, although the effect will vary by app, revenue model and customer base.
Will Customers Pay Less?
The ruling does not guarantee immediate price reductions for users.
If developers can reduce payment costs, some may choose to lower prices, offer different subscription plans or invest more in their products. Others may retain existing prices to cover operating expenses, marketing, customer support and other costs.
External payment options can also introduce additional steps for customers, depending on how they are implemented. A successful change will therefore need to balance payment choice with clear pricing, secure transactions and a straightforward user experience.
The regulator’s orders are intended to expand competition and improve developers’ options, but the final impact on consumer prices will only become clear as companies implement their revised policies.
Google and Apple Respond
Google expressed regret over the decision, saying its recent efforts to broaden payment choices and reduce service fees had not been fully reflected in the regulator’s assessment. In March, the company announced planned changes to its payment policies, including external payment options and lower service fees.
Apple said it disagreed with the commission’s decision and maintained that changes it had already made complied with South Korean law. The company said it was reviewing its next steps under the country’s legal framework.
The disagreement leaves open the possibility of further legal or regulatory challenges. It also illustrates the difficulty of reconciling app-store business models with national rules designed to increase competition.
A Wider Test for Digital Market Regulation
South Korea’s action may draw attention from regulators in other markets that are examining how app stores set payment rules, charge commissions and approve competing services.
The fines themselves are limited in size compared with the global revenues of the two technology companies. The broader significance lies in the corrective orders and the regulator’s effort to make alternative payments more than a theoretical option.
For now, the next milestone will be whether Google and Apple implement changes that satisfy the commission within the required period. Developers will then need to assess whether those changes create meaningful commercial alternatives.
The decision does not end the debate over app-store fees. Instead, it puts the focus on a practical question: whether developers can offer customers a genuine choice of payment methods without facing conditions that undermine that choice.