Korean Government Orders Apple and Google to Change 'No-Refund' App Store Policies

MacRumors · Jul 6, 2014

Apple and Google have been ordered by South Korea's Fair Trade Commission to revise their "no-refund" app store policies in addition to a number of other provisions, reports The Korea Herald. In response to the ruling, Apple reportedly stated that it would consider applying a revised App Store policy worldwide, with Korean officials requiring that Apple send a notice users when its terms and conditions have changed.

Following the FTC orders, the Google Play webstore will design a customer refund system based on Web developers' refund polices. Apple's iTunes app store will have to send a notice to users when it changes the terms in its contract.

"We expect the measure, aimed at protecting consumers, will have a ripple effect on similar cases throughout the world," the Korea Fair Trade Commission said in a press release.

In 2011, the Taiwanese government also pressured Apple and Google to modify their app store policies, with Apple enabling a 7-day refund period. However, it was unclear at the time what changes were made by Apple in order to comply with the law, as the company may have simply addressed it by granting refunds upon request.

Under the current policy, Apple does not offer an automatic way to get refunds for apps. However, refunds have been made available on a case by case basis, as users are able to "Report a Problem" on their purchases to go through iTunes Support. In May, Apple began preventing updates and reinstallation of refunded App Store apps, which was also extended to the Mac App Store.

Article Link: Korean Government Orders Apple and Google to Change 'No-Refund' App Store Policies

goobot · Jul 6, 2014

They should just set up their stores where you can trial a full app for 24 hours, after it stops working unless it's bought.

EricTheHalfBee · Jul 6, 2014

Stupid idea. Apps are dirt cheap. If I spend $0.99 or $1.99 on an App and don't like it, then I've lost nothing.

I have made more expensive purchases (over $25) that I didn't like and a quick support ticket later I was refunded. So it's already possible to get refunds. Making it so that all Apps (including the $0.99 ones) can be refunded is just a huge waste in processing (for example, charging your CC and then refunding $0.99 later on).

If they do this it should only Apply to Apps over a certain price, just like many retail stores request a minimum purchase if you use a credit or debit card.

jameslmoser · Jul 6, 2014

EricTheHalfBee said:
Stupid idea. Apps are dirt cheap. If I spend $0.99 or $1.99 on an App and don't like it, then I've lost nothing.

I have made more expensive purchases (over $25) that I didn't like and a quick support ticket later I was refunded. So it's already possible to get refunds. Making it so that all Apps (including the $0.99 ones) can be refunded is just a huge waste in processing (for example, charging your CC and then refunding $0.99 later on).

If they do this it should only Apply to Apps over a certain price, just like many retail stores request a minimum purchase if you use a credit or debit card.

They could just offer store credit so its applied to future purchases leaving the credit card company out of it.

macs4nw · Jul 6, 2014

jameslmoser said:
They could just offer store credit so its applied to future purchases leaving the credit card company out of it.

Definitely simpler, but probably won't satisfy the Korean Fair Trade Commission.

winston1236 · Jul 6, 2014

Good news for consumers.

gkpm · Jul 6, 2014

"We expect the measure, aimed at protecting consumers, will have a ripple effect on similar cases throughout the world," the Korea Fair Trade Commission said in a press release.

Jeez guys, a bit full of yourselves aren't you... You think this is Gangnam-Style material?

“South Korea is ahead of other countries in dealing with unfair business practices

Joke of the century coming from a country run by chaebols.

dazed · Jul 6, 2014

At least the google play store allow you to return the app for a refund within 15 mins. Apple should think about implementing something similar.

Would certainly weed out the more crappier apps.

ChristianVirtual · Jul 6, 2014

But bad news for smaller devs ... I think apple's cut remain in their pockets ?
The dev pays full. Not good for many smaller devs. We can expect more free apps with more ads in addition to reduce such risks.

taptic · Jul 6, 2014

...It doesn't need changing. This is business and all business is unfair.

macs4nw · Jul 6, 2014

Quote: “South Korea is ahead of other countries in dealing with unfair business practices as it has exclusive laws to regulate unfair clauses,” said Yoon Chul-hwan, an official at the Citizens’ Coalition for Economic Justice.

Seems like a tad hypocritical coming from a country where on a regular basis, criminals convicted of corruption receive full and unconditional pardons from the government, and subsequently without skipping a beat, are reinstated to run huge multinational companies once again, "lest the economy should be disrupted".

Perhaps first practice what you preach…..

JoeyCloverfield · Jul 6, 2014

I think the best way to handle refunds is by making the "Buy" button into a "Return" button once the user has chosen to "Buy" the app.

The app downloads like normal, but behind the scenes, the actual charge is placed on a timer. Technically, you haven't paid for the app yet.

If you don't go back to the App Store and click that Return button within a certain amount of time, it's officially purchased.

You would only be able to do this once per app. With developer's being able to reset it. For example: they update the app to 2.0 and want to give you another chance to try it out.

PocketSand11 · Jul 6, 2014

This is a horrible idea. Apps that don't save any persistent data or aren't going to be used for long will keep getting bought and refunded. Need to use this paid utility for a week? It's free, even if the dev is asking for $30. Even if they prevent multiple purchases/returns, you can just use another account if you ever want to do that again.

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winston1236 said:
Good news for consumers.

No. Expect "free" apps with in-app purchases and loads of ads to increase in number.

Plutonius · Jul 6, 2014

dazed said:
At least the google play store allow you to return the app for a refund within 15 mins. Apple should think about implementing something similar.

Would certainly weed out the more crappier apps.

Doesn't satisfy the Korean requirements and Google will have to change the Google play store per the Korean recommendation.

Xenc · Jul 6, 2014

It's important to note that when refunding apps, Apple keeps their 30% cut and charges it to the developer. This means the developer makes a net loss!

dermeister · Jul 6, 2014

I have a feeling Samsung is behind this. They control neither the App Store or Google Play, and this way they don't get customers complaining to them about refunds on Apps. Depends on exactly what the ruling is, but this could easily be abused.

velocityg4 · Jul 6, 2014

goobot said:
They should just set up their stores where you can trial a full app for 24 hours, after it stops working unless it's bought.

They'd have to setup some method for games to be blocked from this after a certain percent is complete. Otherwise people could buy a game, beat the main game then get a refund.

EricTheHalfBee said:
Stupid idea. Apps are dirt cheap. If I spend $0.99 or $1.99 on an App and don't like it, then I've lost nothing.

I have made more expensive purchases (over $25) that I didn't like and a quick support ticket later I was refunded. So it's already possible to get refunds. Making it so that all Apps (including the $0.99 ones) can be refunded is just a huge waste in processing (for example, charging your CC and then refunding $0.99 later on).

If they do this it should only Apply to Apps over a certain price, just like many retail stores request a minimum purchase if you use a credit or debit card.

I would say it would be nice to have this process even for free apps. If just to have an easy means to permanently remove an app from your account. I rarely get anything because I don't want to see anything I didn't like cluttering up my account. At least with a computer if I don't like a program I can throw out the disc and wipe it off the hard drive.

jeffe · Jul 6, 2014

EricTheHalfBee said:
Making it so that all Apps (including the $0.99 ones) can be refunded is just a huge waste in processing (for example, charging your CC and then refunding $0.99 later on).

They can authorize the card and settle it only after the refund window passes, if the refund window is small duration of time. I know Google play has a 15 minute refund window but they'll also refund you after that window has passed if you ask.

dermeister · Jul 6, 2014

velocityg4 said:
I would say it would be nice to have this process even for free apps. If just to have an easy means to permanently remove an app from your account. I rarely get anything because I don't want to see anything I didn't like cluttering up my account. At least with a computer if I don't like a program I can throw out the disc and wipe it off the hard drive.

Hah! Good take. Yeah they should really make it possible to purge junk from your account.

dazed · Jul 6, 2014

Plutonius said:
Doesn't satisfy the Korean requirements and Google will have to change the Google play store per the Korean recommendation.

Understood, but at least it's a better policy than Apple has in place at the moment. Sometimes people want a refund. There should be a window you can return within and that window should protect developers as well as the users from abuse.

I'd settle for a few hours and also means that people may try more apps if they know they can return if they don't prove useful.

IGregory · Jul 6, 2014

goobot said:
They should just set up their stores where you can trial a full app for 24 hours, after it stops working unless it's bought.

At this years WWDC Apple announced App previews: Developers can post short videos of apps to the App Store. This should go a long ways towards fixing the problem.

dumastudetto · Jul 6, 2014

Just pull the business out of South Korea. Simples.

Mr. Retrofire · Jul 6, 2014

gkpm said:
Jeez guys, a bit full of yourselves aren't you...

I can see what you mean. Don't protect the customers, protect multi-billion Dollar companies.

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macs4nw said:
...country where on a regular basis, criminals...

...Perhaps first practice what you preach...

You mix two things, which have nothing to do with each other.

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dumastudetto said:
Just pull the business out of South Korea. Simples.

Why do you have simple solutions for everything!?

H2SO4 · Jul 6, 2014

EricTheHalfBee said:
Stupid idea. Apps are dirt cheap. If I spend $0.99 or $1.99 on an App and don't like it, then I've lost nothing.

I have made more expensive purchases (over $25) that I didn't like and a quick support ticket later I was refunded. So it's already possible to get refunds. Making it so that all Apps (including the $0.99 ones) can be refunded is just a huge waste in processing (for example, charging your CC and then refunding $0.99 later on).

If they do this it should only Apply to Apps over a certain price, just like many retail stores request a minimum purchase if you use a credit or debit card.

So its 99¢ big deal. No!
These apps are supposed to be vetted and in some cases they are not. As vetting is part of the, (seemingly arbitrary), process that Apple insist upon to use the store they must accept some liability here.
If they havent done their job properly, and for some of the stuff that slips through youd have to assume that they dont, then theyre skimming money off the top for nothing.
This is one of the problems created in a race to the bottom. Regardless of how much money I have spent if someone has sold me a defective product I deserve a refund, and whether I choose to pursue one or not is my business.

Millah · Jul 6, 2014

I mean really? Are people really sweating .99 purchases this much these days? I'm not saying this isn't a good thing for consumers, but app prices have become so dirt cheap these days that do you really feel that burned spending less than a dollar on an app?

I can just see this being abused. People buying a game for dirt cheap prices, beating it in a few hours, and then demanding a refund. Consumers have already won big time by having a free market for great software at shockingly low prices. Do we really feel entitled to demanding a refund for something that typically costs between 1-3 dollars, when doing a little bit of research before purchasing could have probably helped mitigate buyers remorse?

Now if some app was scamming people, I could understand that. But doesn't Apple already have policies in place that reject apps that don't "function as advertised?"

Korean Government Orders Apple and Google to Change 'No-Refund' App Store Policies

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