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South Korea's Fair Trade Commission says Apple will fix a loophole that effectively required local developers to pay the company a 33% commission.
With few exceptions, developers must pay a 30% commission to Apple on all App Store sales. However, in South Korea, they are not charged the price of the application, but this price plus 10% local value-added tax (VAT).
Consequently, Apple's commission was 33%. After the developers reported this to the FTC, in September 2022, the regulator raided Apple's local offices.
The Times of India reports that Fair Trade Commission (FTC) Chairman Han Ki Jeong told reporters. that the issue can now be resolved.
“In September, the US Federal Trade Commission (FTC) promptly launched an investigation following reports that Apple was charging unfair fees only to local app developers,” he said. “Apple recently said it would voluntarily fix the problematic action by January of next year.”
“If Apple fixes everything,” Khan continued, “it will ease some of the hardships for domestic app developers.”
It's not clear why Khan thinks this, because the net benefit to developers is almost zero, if any. Taxes still have to be paid, and it is now the developers' responsibility to pay them.
Apple and Google are being investigated separately by South Korean regulators for alleged violations of local in-app payment laws.
