Government Set to Require Tech Giants to Open Up App Marketplaces in New Law

The Yomiuri Shimbun

15:03 JST, January 11, 2024

The government is set to submit a new bill to regulate tech giants to the ordinary Diet session, which will be convened late January. The envisaged law is expected to oblige IT giants to open up mobile app marketplaces.

The smartphone-related market is monopolized almost entirely by Apple Inc. and Google LLC, a situation criticized as detrimental to the market. By introducing regulations against such tech giants, the government aims to increase market competition for the purpose of lowering usage fees and diversifying services.

The bill will oblige Apple to allow entry of third-party app marketplaces and also include a clause that will ban the company and other platform operators from forcing app developers to use their settlement system. The Fair Trade Commission will have jurisdiction over the envisaged law.

Users of Apple’s iPhone download apps exclusively from Apple App Store in principle, a system that is said to hinder competition. Apple also imposes a fee of up to 30% of app revenue on developers using its marketplace, an amount criticized as too high.

The European Union has taken the lead in regulating IT firms. The EU’s Digital Markets Act obliges designated firms to open up app marketplaces, and are required to comply from March.

The Japanese government intends to finalize details of the bill after observing the tech giants’ responses to the EU regulations.