Korea's fair trade watchdog bolsters monitoring of mobile app, O2O markets

South Korea’s Fair Trade Commission (FTC) is strengthening its watch over online businesses to better protect small firms and consumers against market dominators, a move likely to mostly target multinationals like Google.

The FTC said Monday that it has added teams for monitoring mobile app and online-to-offline (O2O) platform markets. The new teams, part of ICT team, will keep their eyes on unfair and fraudulent practices in the mobile app market, such as forced use of certain payment methods and preventing app developers from publishing their products at multiple outlets.

The latest move is seen as the FTC’s countermeasure against global internet giant Google that is accused of damaging fair competition with its dominant power. Google last year announced it will enforce rules that require app developers to distribute software on its Google Play Store to use its app payment system, as well as take a 30 percent fee from developers on all in-app purchased within the app market.

The Korean fair trade agency currently is investigating the issues.

In addition, Google is accused of blocking app developers from working with other app market operators. The case is also under the FTC’s probe.

On top of monitoring the app market, the FTC’s new teams will scrutinize O2O platforms for any unfair practices, such as hotel booking apps deceiving consumers with misleading advertisements and delivery apps forcing unfair contracts to drivers.

Since launched in November 2018, the FTC’s ITC monitoring team has completed seven fair trade investigation cases, including Naver’s foul use of its online platform dominance to hinder fair competition in the real estate data market.

The ITC team has been closely working with external specialists from ICT technology to legal and business fields, with a plan to expand the specialist pool, said the FTC.

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