Google faces fair trade investigation in South Korea

Seoul's antitrust watchdog said on Wednesday it has launched an investigation into US-based Google, as well as its Singaporean and South Korean offices, over allegations of violations of the fair trade law involving game developers on its app marketplace.

The Fair Trade Commission (FTC) said its examiners' report showed Google has abused its dominance in the Android marketplace, with related sales totalling US$9.21 billion. Under the law, the watchdog may impose a fine of up to 6 per cent of the amount following its deliberations.

The FTC said Google signed the Games Velocity Program (GVP) agreements with major game developers at home and abroad to prevent their potential departure from its app marketplace, reports Yonhap news agency.

The programme centres on subsidising game developers' costs for using Google services, such as Google Cloud and advertising, on the condition that they give Google most favourable treatment compared to other app marketplaces, including earlier release dates.

The FTC said its examiners had concluded that the agreements had significantly hindered game developers from entering rival app marketplaces, disrupting other platforms' business activities.

The examiners also determined that the GVP agreements had effectively forced game developers to engage in exclusive dealing with Google.

Google, meanwhile, has eight weeks to file written opinions regarding the examiners' report.

Late last month, the fair trade watchdog approved voluntary corrective measures worth 3 billion won ($1.94 million) proposed by Coupang Corp. and its private-label affiliate over unfair dealings with subcontractors.

The decision by the Fair Trade Commission (FTC) came after the watchdog's probe found that Coupang and its wholly owned subsidiary, Coupang Private Label Brands (CPLB), had sought a consent decree to resolve the case without further legal proceedings.

According to the FTC, the two companies had provided 314 subcontractors with contracts that omitted legally required information and lowered supply prices for 94 subcontractors through discount promotions that were not stipulated in their agreements since 2022.