The Framework

Japan’s Smartphone Software Competition Promotion Act (SSCP) regulates digital platforms deemed essential for smartphone use. First promulgated on June 19, 2024, its provisions came into full effect on December 18, 2025, requiring covered entities to comply with new conduct requirements.[1] The legislation broadly attempts to restrict designated operators from using their market positions to disadvantage competitors or limit consumer choice, including through prohibitions of “unreasonable discrimination” against app developers, bans on prioritizing proprietary applications or services without a legitimate reason, the imposition of strict limits on anti-steering measures as well as restrictions on alterntaive payment methods and browser engines unless such actions are necessary for cybersecurity.[2]

Implications for U.S. Technology Companies

American companies like Apple and Google hold a significant share of Japan’s smartphone software market and are likely to bear substantial costs associated with the bill’s mandates. First, they will be prevented from engaging in a number of procompetitive practices and operating system integrations, including those that improve user privacy and security. Moreover, directing resources towards compliance efforts slows down innovation, undermining the global competitiveness of large U.S. tech companies in a crucial Asian market.

How China Benefits

By regulating the major U.S. smartphone platform operators, Japan’s bill inadvertently creates an opening for Chinese firms looking to enhance their mobile presence. Companies from China may find themselves not only benefiting from increased access to Apple and Google’s platforms, but also better able compete by offering better privacy and security due to being unencumbered by the regulation. That is, while Apple and Google will be forced to invest energy and capital in compliance, Chinese device manufacturers and software platforms will be free to concentrate more of their resources on capturing Japanese consumers.

Endnotes