## New Legislation Aims to Curb Tech Giants' Control Over App Stores and Payment Systems
The Fair Trade Commission (FTC) is proposing new legislation that would impose hefty fines on tech giants like Apple and Google if they continue to dominate the distribution of smartphone apps. The proposed bill, which is currently being submitted to the Diet, aims to promote fair competition in smartphone app stores and payment systems.
Under the proposed law, tech giants could face fines of up to 20% of their related domestic sales for a first offense and 30% for repeated infringements. This represents a significant increase from the current 6% surcharge for similar violations under the Anti-Monopoly Law. The FTC believes that a higher surcharge is necessary to deter dominant players like Apple and Google, who control the global market for smartphone operating systems.
Barring competitors from offering alternative app stores
Preventing app makers from using outside payment systems
This would allow for greater competition in app stores and payment systems, potentially leading to lower service fees and more options for consumers.
The FTC hopes that this new legislation will help to address the rapidly changing market of digital products and services. Unlike the Anti-Monopoly Law, which focuses on addressing anti-competitive practices after they occur, the new legislation aims to prevent such practices through "ex-ante regulations." This proactive approach is seen as necessary to keep pace with the evolving digital landscape.
The proposed legislation is inspired by similar efforts in the European Union, where the Digital Markets Act allows for fines of up to 10% of a company's annual global sales for violations. The FTC believes that this approach is necessary to ensure a level playing field for all players in the digital market.