Tech giant Alphabet Inc's (GOOGL.O) Google has been imposed a fine of $176.64 million by South Korea's antitrust regulator for blocking customised versions of its Android operating system (OS), reports Reuters. This is the second setback to the US technology giant's in the country in less than a month.

Google's contract terms with device makers is an abuse of its dominant market position that restricted competition in the mobile OS market, said Korea Fair Trade Commission (KFTC) on Tuesday.

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Releasing a statement, Google said it would appeal against the ruling. The tech giant added that it ignores the benefits offered by Android's compatibility with other programmes and undermines advantages enjoyed by consumers.

This could be the ninth-biggest fine it has ever imposed, said the antitrust regulator.

According to KFTC, Google is hampering competition by making device producers abide by an "anti-fragmentation agreement (AFA)".

The agreement forbid manufacturers to equip their handsets with modified versions of Android, known as "Android forks". That has helped Google cement its market dominance in the mobile OS market, the KFTC said.

Google has also been banned from forcing device makers to sign AFA contracts, allowing manufacturers to adopt modified versions of Android OS on their devices.

The ruling comes on the day when an amendment to South Korea's Telecommunications Business Act - known as "anti-Google law" - came into effect.

This bill was passed in August and it bans app store operators such as Google from requiring software developers to use their payment systems. The requirement had effectively stopped developers from charging commission on in-app purchases.