[Comprehensive] "To be processed on the 20th" Google Fair Trade Act gains momentum... What will be included in the integrated bill?

[Asia Economy Reporters Seulgina Jo and Eunmo Koo] "Next Tuesday (the 20th), the 3rd Agenda Adjustment Committee will handle the 'Telecommunications Business Act' to ban Google's forced in-app payments. We can no longer wait for the People Power Party's decision-making, which lacks reason and justification."

The so-called 'Google Gapjil Prevention Act (Amendment to the Telecommunications Business Act)' aimed at blocking Google's unilateral commission policy changes is gaining momentum. With Google's forced in-app payment implementation scheduled for October, the ruling party has reaffirmed its plan to pass the bill within this month even without opposition cooperation. The National Assembly's Science, Technology, Information and Broadcasting and Communications Committee's Agenda Adjustment Committee, led by the Democratic Party of Korea, has virtually finalized an integrated working-level adjustment plan centered on banning forced in-app payments after collecting opinions from ministries and industry.

◆Final Ultimatum to Opposition... Google Gapjil Prevention Act Expected to be Passed at Agenda Adjustment Committee on the 20th

Cho Seung-rae, the Democratic Party's ranking member of the National Assembly's Science, Technology, Information and Broadcasting and Communications Committee and chair of the Agenda Adjustment Committee, announced this after concluding the 2nd Agenda Adjustment Committee meeting on the afternoon of the 15th.

First, Chair Cho explained the progress, saying, "Today, we completed the second review of the amendment to the Telecommunications Business Act that prohibits forced in-app payments. We listened to the opinions of associations, organizations, and stakeholders, as well as relevant ministries such as the Korea Communications Commission, the Fair Trade Commission, and the Ministry of Culture, Sports and Tourism, and based on that, we concretely organized the bill's contents."

The Google Gapjil Prevention Act, which was the biggest issue during last year's national audit, currently has seven bills pending. The main points include prohibiting app market operators from forcing developers to use specific payment methods or inducing them not to register content on other app markets, thereby banning abuse of market dominance.

If the Google Gapjil Prevention Act is passed at the Agenda Adjustment Committee on the 20th, it will be immediately referred to the full Science and Technology Information and Broadcasting and Communications Committee. Considering the number of seats, it is expected to pass smoothly through the full committee, the Legislation and Judiciary Committee, and the plenary session. Earlier, Google announced that from October, app developers on its app market, Google Play, will be forced to use in-app payments when selling content and items, with a hefty 30% commission fee. Considering the time required for enacting enforcement ordinances, the bill must pass within this month to complete legislation before October.

Originally, the Democratic Party planned to approve the Google Gapjil Prevention Act at the Agenda Adjustment Committee on this day and refer it to the full committee, but they decided to postpone it once. An agenda referred to the committee can be submitted to the full committee if approved by two-thirds or more of the members. Currently, among the six committee members, Democratic Party members Cho Seung-rae, Jung Pil-mo, Han Jun-ho, and independent member Yang Jung-sook have expressed support, so it can be handled without the People Power Party.

At the press conference, all agenda adjustment committee members except the People Power Party, including Chair Cho, Jung Pil-mo, Han Jun-ho (Democratic Party), and Yang Jung-sook (Independent), attended and repeatedly urged the People Power Party to return to the Science and Technology Information and Broadcasting and Communications Committee. Opposition members Hwang Bo-seung-hee and Heo Eun-ah of the People Power Party, who are boycotting the committee schedule, also did not attend the Agenda Adjustment Committee.

Chair Cho emphasized the urgency of passing the bill, saying, "With Google's unilateral enforcement of forced in-app payments scheduled for October, domestic and international mobile content developers have serious concerns. The resulting price increases for content will directly burden mobile content consumers. We have had sufficient discussions so far. We can no longer wait." He raised his voice, saying, "The National Assembly must fulfill its duty to create a fair mobile ecosystem and protect content developers and consumers who are suffering from the tyranny of big tech companies. We can no longer wait for the People Power Party's refusal to schedule, which lacks reason and justification."

As of mid-October 2020. Since then, Assemblyman Jo Myeong-hee of the People Power Party also took the lead in proposing an amendment to the Telecommunications Business Act aimed at prohibiting app market operators from forcing payment methods and resolving related disputes.

◆Concerns Over Forced In-App Payments and Overlapping Regulations... Content Equal Access Rights to be 'Recommended + Post-Report'

Before the press conference, the Agenda Adjustment Committee expressed concerns that unfair practices could continue if Google enforces in-app payments.

The core of the seven bills previously proposed is also the prohibition of in-app payments. The bills proposed in the second half of last year by Park Sung-joong, Cho Seung-rae, Yang Jung-sook, and Cho Myung-hee include provisions preventing app market operators from forcing specific payment methods. The bills by Cho Seung-rae, Han Jun-ho, and Heo Eun-ah include prohibitions on app market operators forcing or inducing app developers not to register on other app markets.

The integrated working-level adjustment plan currently under discussion by the Agenda Adjustment Committee also mainly includes prohibiting app markets from forcing specific payment methods and banning app market operators from forcing or inducing registration restrictions on other app markets. A committee official said, "Regarding in-app payments, the core content has been organized without disagreement among ministries and committee members. Only detailed opinion adjustments and fine-tuning of role division between the Korea Communications Commission and the Fair Trade Commission remain."

Given concerns that Google's unilateral commission abuse could adversely affect domestic creators, consumers, and the entire digital content industry, relevant ministries are positive about the bill's passage. However, the Fair Trade Commission pointed out that some provisions overlap with the Fair Trade Act.

The Fair Trade Commission stated, "The professional and technical provisions in the amendment to the Telecommunications Business Act are matters for legislative policy decisions by the National Assembly, but prohibitions on app market operators overlap with unfair trade practices or abuse of market dominance under the Fair Trade Act, so careful review is necessary." In response, Chair Cho said, "There may be some overlap between the Fair Trade Commission and the Korea Communications Commission regarding whether the issue is antitrust-related or a technical specialized issue. For the swift rights relief of developers harmed by so-called gapjil, the two ministries should coordinate in a progressive direction."

The 'Content Equal Access Rights' included in Han Jun-ho's bill is evaluated as a measure to restore competition in the already tilted domestic app market, but since some companies have raised objections, it is expected to be included as a 'recommendation' rather than a mandatory provision.

This provision requires that when mobile content providers supply content to a specific app market operator, they must also provide it without discrimination to other app market operators. It is intended to be introduced only for businesses above a certain scale, excluding small and medium developers, to expand user choice and create an environment for fair competition. This reflects the judgment that proper competition is impossible solely by market power, such as Google Play's 70% market share.

The Ministry of Science and ICT has expressed its intention to accept Representative Han's amendment changing the provision from mandatory to recommended. Furthermore, it suggested the need to consider supporting content developers to enter various app markets.

In response, Representative Han Jun-ho said, "If the equal provision clause ends as a recommendation, it may not be properly observed. It is necessary to codify that businesses report the results to the Minister of Science and ICT to realize the law's intent." Representative Jung Pil-mo also agreed, saying, "It would be better to revise it to recommendation followed by result reporting."

This content was produced with the assistance of AI translation services.