Apple allows third-party payment systems for apps in South Korea

Friday 1 July 2022 12:39 CET | News

Apple has announced that apps release in the South Korean App Store no longer must use the company’s on in-app payment system.

The change comes in response to an amendment to South Korea’s Telecommunications Business Act passed in 2021, which prevents large platform holders like Apple and Google from forcing developers to use their first-party in-app payment systems. Both Apple and Google opposed the legislation, with Apple arguing that it would make it harder for its users to manage their purchases, undermine their privacy protections, and put them at risk of fraud.

The law threatens the lucrative commission that Apple charges developers to use its in-app payments system. This so-called ‘Apple tax’ is up to 30% of the price paid by the user, and has been the focus of many developer complaints over the years. But although South Korea is forcing Apple to allow developers to use alternative payment systems, Apple still intends to collect a commission of 26% for payments made through third-party systems. Its documentation notes that developers will be required to report all sales to Apple each month, and will then need to pay the commission.

To use third-party payment systems, interested developers will need to submit a form to Apple to request access to the ‘StoreKit External Purchase Entitlement,’ which is only available to apps distributed exclusively in South Korea. If an app is available globally, developers will need to submit a separate app binary ‘that is distributed solely on the App Store in South Korea.’

Apple also says alternative payment systems cannot be used ‘in the same app with Apple’s in-app purchase system’ and purchases must be completed within the app itself rather than linking out to a web view. Combined, these are arguably a restrictive set of rules that could dissuade many app developers from taking advantage of third-party payment systems. ‘Developers who want to continue using Apple’s in-app purchase system may do so and no further action is needed,’ Apple’s notice reads.

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Keywords: Apple, mobile payments, regulation, compliance
Categories: Payments & Commerce
Companies: Apple
Countries: Korea, Republic of
This article is part of category

Payments & Commerce


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