Apple, Google May Have to Allow Third-Party App Stores, Payments in Japan: Report

Japan is reportedly working on new regulations that will require big tech giants including Google and Apple to permit app downloading from outside their official app stores — Google Play, App Store. The legislation is expected to be sent to parliament next year. The two tech companies are currently facing regulations from various governments to open their in-built app stores and allow users to install apps from third-party sources. The iPhone maker is expected to bring changes to its App Store policies to comply with the European Union's new Digital Markets Act (DMA).

As per a new report by Nikkei Asia, the Japanese government is preparing laws that will require Apple and Google as well as other similar companies to allow users to download apps outside their official app stores and let alternative payment methods for any apps. With the latest move, the government aims to stimulate competition and curb abuse of the tech giant's dominant position in the Japanese market.

The legislation is reportedly slated for submission to parliament next year. The legislation could focus on four areas — app stores and payments, search, browsers, and operating systems. Once approved, the regulations would allow the Japan Fair Trade Commission (JFTC) to impose fines on companies for antitrust issues. It would be able to fine firms up to 6 percent of the revenue generated from illegal activities. More details about the regulations are expected to be out before spring next year. 

The legislation is expected to let Japanese companies to have third-party app stores on iOS and Android platforms. Developers might also be able to choose payment systems from local firms with lower service charges.

Japan's rumoured antitrust legislation seems to be similar to the European Union's Digital Markets Act. The DMA is expected to come into full force in 2024. As per DMA, companies with more than 45 million monthly active users and a EUR 75 billion (roughly Rs. 670 crore) market capitalisation are to be considered gatekeepers providing a core platform service. The DMA requires Apple to enable developers to publish their iOS apps outside of the App Store.

Apple is reportedly working on allowing users in the European Union to sideload iPhone apps. An upcoming iOS version is expected to enable sideloading of apps in select regions.