Japan Planning to Force Apple to Allow Sideloading Apps

The Japanese government is working to roll out new regulations that will force both Apple and Google to allow alternatives to the iOS App Store and Google Play Store, respectively. It will also levy fines against the two companies over antitrust issues due to operating system market share and preferential search results.

The planned regulations follow the country’s previous moves to force Apple to allow third-party app stores, as well as Apple’s attempt to push back against the plan.

According to Nikkei Asia, if the proposed regulations are put into force by the country’s parliament in 2024, the Japanese Fair Trade Commission (FTC) will have the power to fine companies up to 6% of the revenue earned from activities covered by the new laws.

The commission has not made any further decisions regarding Apple and Google’s app stores and there is little information to be had about the Japanese FTC’s focus on search, browsers, and operating systems.

The FTC is looking at search in an attempt to prevent companies like Google and Apple from giving preferential treatment to their in-house solutions and products.

While it’s not set in stone, the new regulations would likely also cover the Japanese government’s concerns over collecting the proper amount of taxes from developers. The Japanese government has had difficulty in taxing app developers that reside outside of Japanese borders, leading the government to consider direct taxes on Apple and Google’s app store operations.

If the Japanese parliament passes the proposed laws, the Japanese government will determine which companies any or all of the new regulations will apply to. The Nikkei Asia report says the laws are expected to only apply to multinational firms and not to Japanese firms.

Apple has yet to comment on the Japanese government’s plans.

This is not the first time Japan has planned on cracking down on Apple and Google. Earlier this year, The Japan Times reported that the government will require Apple and Google to allow users to download and install apps from outside sources, rather than requiring them to install apps from their official app stores. It is hoped that the government’s new regulations will help stimulate competition and reduce app prices.

Both companies will also be required to make it easier to remove pre-installed apps from their devices. They will also be required to not give preferential treatment to themselves within their search engines. While Apple doesn’t own a search engine like Google, it does make Google the default search engine in the Safari browser. The Japanese government may also be concerned about Apple’s device search feature, Spotlight.

Apple does not currently allow users to sideload apps on its iPhone or iPad devices, although the could change next year as new rules come into effect in the European Union. Google does permit users to sideload apps, although 97% of Android users still use the Google Play Store.

Both tech firms will also be required to allow users to make payments through third-party platforms in addition to using the app stores’ built-in payment methods.

These possible new regulations are just the latest in the Japanese government’s efforts to crack down on Apple and its businesses. In December 2022, the city of Tokyo’s officials hit Apple Japan with $98 million in additional taxes for incorrectly exempting tourists and resellers from a consumption tax.