Alphabet’s Google said Thursday that it plans to allow third-party payment systems in South Korea to comply with a new law, in the first time the American tech giant has modified its payment policy for a specific country.
Google’s announcement comes after the Korean Communications Commission (KCC) asked Google and Apple Inc to submit plans for compliance with the new law, which bans major app store operators force software developers to use their payment systems. Most of the new law went into effect in mid-September.
The brake is the first measure of its kind adopted by a major economy against companies such as Apple and Google, which face worldwide criticism for requiring the use of their own payment systems that charge commissions of up to 30%.
In late August, parliament passed an amendment to the South Korean Telecommunications Companies Act, dubbed the “anti-Google law,” which prohibits large app store operators, such as Google and Apple Inc, from forcing users to developers to use their payment systems, preventing them from charging commissions for in-app purchases.
“We respect the decision of the National Assembly and we are sharing some changes to respond to this new law, including giving developers who sell digital goods and services within applications the option to add an alternative billing system alongside the billing system of Google Play for its users in South Korea, ”Google said in a statement.
Google, which charges developers a 15% service fee for distributing apps, said it would reduce it to 11% when users choose an alternative billing system, recognizing that developers will incur costs to maintain their own billing system.
It is unclear to what extent this benefits developers.
Google added that alternative billing systems may not offer the same protection or payment options and features of the Google Play billing system.
The KCC said Google’s plans would be implemented this year and would only apply to South Korea.
In October, Apple told the South Korean government that it was already complying with the new law and did not need to change its app store policy.
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