By Joyce Lee

SEOUL (Reuters.) – South Korea’s laws prohibiting dominant app stores operators from requiring app developers to use their exclusive payment system are being ignored by Alphabet (NASDAQ.)’s Google, according to Reuters.

South Korea is the first nation to adopt legislation that restricts the payment practices of tech companies. A Korea Communications Commission official said Wednesday that they will publish the preliminary details.

South Korea modified the Telecommunication Business Act August in an attempt to reduce market dominance by tech companies and prevent big app stores operators charging commissions for purchases made in-app.

While the law came into force in September, specifics of compliance are still being worked out by KCC as part of an enforcement ordinance.

Apple had told the South Korean government that it was already complying and did not need to change its app store policy https://www.reuters.com/technology/skorea-targets-apple-over-new-app-store-regulation-2021-10-15, while Google said it plans to allow third-party payment systems in South Korea https://www.reuters.com/technology/google-plans-allow-third-party-payments-systems-skorea-2021-11-04, but will only reduce its service fee charge to developers by 4 percentage points when users choose an alternative billing system.

Developers are charged up to 30% by tech companies for in-app transactions.

“Frankly, we are not satisfied,” lawmaker Jo Seoung-lae who spearheaded the amendment said.

Jo stated that excessive fees hinder developers’ ability to innovate… Parliament must be informed closely as government drafts regulations in detail to ensure accountability.

Apple and Google have not yet responded to comment requests.

Kim Hyun, Vice Chairman of the KCC told an app ecosystem fairness conference that “finely woven regulatory details” are being drafted by the KCC. The ordinance will be presented to a committee on Wednesday.

Epic Games CEO Tim Sweeney said that “This legislation is the first in the world with the opportunity to transform this market from a double-poly with Apple or Google,” Reuters.

It is unclear how the rules will be observed or what penalties may be in place for violating them.

Reuters has seen an early draft of the Enforcement Ordinance. It stipulates that app market operators who violate the law may be fined up to 2% of their revenue.