A new Japanese law aims to foster competition in the smartphone app market by allowing third-party app stores and billing providers to operate on Apple iOS and Google Android platforms. This legislation, known as the Act on Promotion of Competition for Specified Smartphone Software, was announced by Japan’s Fair Trade Commission (FTC).
Under this new law, major tech companies like Apple and Google, referred to as ‘designated providers,’ are prohibited from blocking competitors from offering alternative app stores and payment services. Additionally, these companies must provide equal access to their platforms’ features and functions for third-party developers as they do for their own services. They are also barred from favoring their services in search results.
The law, approved by Japan’s House of Councillors, will be enforced within the next 18 months. Companies failing to comply will face fines amounting to 20% of their revenue in Japan, increasing to 30% if anticompetitive behaviors persist, according to a Kyodo report.
This regulatory move aligns Japan with the European Union’s Digital Markets Act (DMA) and similar actions by the U.S. Department of Justice and the U.K. The DMA, effective since last May, targets large tech firms, requiring them to allow third-party marketplaces and payment processors for app sales.
Epic Games CEO Tim Sweeney, who previously challenged Apple’s App Store policies in the U.S., welcomed the new law. He announced plans to re-launch Fortnite on iOS in Japan and the UK next year.
Despite these regulatory efforts, enforcing compliance remains challenging. Both Apple and Google have been criticized for making it difficult for users to install apps from third-party sources. The European Commission has even launched an investigation into whether these companies, along with Meta, are meeting their obligations under the DMA.
As Japan prepares to implement its new regulations, it is likely monitoring these international developments to ensure effective enforcement against potential non-compliance by major tech firms.
