The South Korea Fair Trade Commission today fined Google $177 million for abusing its dominant market position and restricting competition in the mobile OS market. Its offense? It didn’t allow Samsung to fork Android to create its own customized version.

According to the complaint, Google enforces what it calls its anti-fragmentation agreement (AFA) with handset makers, which restricts how they can fork or customize Android for their own needs. But the KFTC now bans Google from enforcing this agreement with hardware makers, and the online giant can no longer enter into new AFAs.

In addition to creating problems for Android licensees, the AFA also applies to other Google platforms, including Wear OS. And it was this requirement that caused Samsung to abandon Wear OS and switch to Tizen instead.

The KFTC has been investigating Google for this problem since 2016, but it says that Google has been using its AFA as a cudgel against its partners since at least 2011. The AFA is “an unprecedented anticompetitive action” that “inhibited innovation,” according to the regulatory body.

Google says it will appeal the antitrust action.

“The KFTC’s decision released today ignores [the] benefits [of the AFA], and will undermine the advantages enjoyed by consumers,” a Google statement notes.

This isn’t the only roadblock that South Korea has introduced in recent weeks. Two weeks ago, the country approved a new law that requires mobile platform makers like Google to offer third-party payment methods to developers.

Tagged with Antitrust