Japan is poised to significantly increase fines for tech giants engaged in monopolistic practices, particularly within the app distribution space. This move follows a global trend towards regulating the power of major technology companies.
The proposed legislation specifically targets companies like Apple and Google, whose operating systems dominate the smartphone market.
Fines Tripled to Discourage Anti-Competitive Behavior
Under the new bill, these mobile platform operators would be required to allow third-party app stores and payment systems on their devices. This would promote competition and potentially lead to lower prices and a wider variety of app choices for consumers.
The proposed penalty for violations is a hefty 20% of a company’s sales generated from app distribution in Japan, which is more than triple the current fine of 6%. Repeat offenders could face even steeper fines of up to 30% of sales. This significant increase in potential penalties reflects a growing concern that current regulations are insufficient to deter anti-competitive behavior, notes NIX Solutions.
Japan Aligns with Global Trend to Regulate Big Tech
The move by Japan aligns with similar efforts around the world. The European Union recently enacted the Digital Markets Act (DMA) which also aims to curb the power of big tech companies. The DMA allows for fines of up to 10% of a company’s global sales for violations, with the potential for even higher penalties for repeat offenders.
We’ll keep you updated on the progress of this legislation in Japan and how it might impact the app market globally.