South Korea Ends Monopoly on In-App Payments; Will Spur Innovation and Benefit Consumers
WASHINGTON, D.C. – Today the South Korean government took a momentous step forward in the fight for app fairness by passing the world’s first law aimed specifically at bringing competition and fairness in the digital marketplace.
South Korea’s new law prohibits app store platforms from requiring developers to use the app store’s payment processing services for in-app purchases. Competition among payment processors will likely bring down the “app tax,” which ranges between 15-30% for all digital services. Lower rates would help developers invest in their businesses and workforce, and benefit consumers with greater innovation and more choice.
“South Korea’s new app store law is a significant development in the global fight to bring fairness to the digital economy,” said Meghan DiMuzio, Executive Director of CAF. “South Korean lawmakers and President Moon Jae-in have made history and are setting an example for the rest of the world. This law will hold app store gatekeepers accountable for their harmful and anti-competitive practices. The Coalition for App Fairness hopes U.S. and European lawmakers follow South Korea’s lead and continue their important work to level the playing field for all app developers and users.”
The South Korean law is the world’s first piece of legislation to pass that explicitly addresses the anticompetitive practices of app store gatekeepers. The law comes as the bipartisan, bicameral Open App Markets Act has been introduced in the U.S. Congress, and as European legislators are set to begin consideration of the Digital Markets Act.
About the Coalition for App Fairness
The Coalition for App Fairness is an independent nonprofit organization formed to protect consumer choice, foster competition, and create a level playing field for all app and game developers globally. Originally formed by Basecamp, Blix, Blockchain.com, Deezer, Epic Games, the European Publishers Council, Match Group, News Media Europe, Prepear, Protonmail, Skydemon, Spotify, and Tile, CAF has rapidly grown from 13 to over 60 members since launching in September 2020. CAF offers membership to companies of any size — join today at appfairness.org.