Apple has revised its rules for developers wanting to launch app stores on iPhones in the EU, a move the reluctant tech giant has been forced to do by European legislation which came into force last week and which is intended to break Apple's market monopoly.

But Apple has introduced stringent conditions, described by Spotify as "extortion", for developers wanting to use its platform. As well as charging apps a 30 per cent commission to apps using its store, Apple's initial rules included a requirement for developers to put up a EUR 1 million (US$1.1 million) letter of credit (L/C).

L/C alternative

This condition has now been revised, and developers are being offered an alternative to putting up a standby L/C by based on their trading record with Apple.

The alternative is for the developer to be a member of good standing in the Apple Developer Programme for two continuous years or more, and have an app that had more than one million first annual installs on iOS in the EU in the prior calendar year.

The option remains for developers to provide Apple a standby L/C in the amount of EUR 1 million from a financial institution that is at least A-rated or equivalent by S&P, Fitch, or Moody's, and maintain that standby L/C as long as their alternative app marketplace is in operation.

Accusations and defence

If the developer is unable to maintain the L/C, Apple can close their apps down, a rule US developer Colton Adamski has compared to a gangster from The Godfather or Sopranos. "You can open your shop on their turf, but you have to do exactly as they say or they will shut you down," he says.

Apple has not responded to questions from British Broadcasting Corporation (BBC) journalists asking about the L/C requirement, but has previously said its app store rules are to weed out dodgy, or scam, stores.

This article represents the views of the author and not necessarily those of the ICC or Coastline Solutions.