New Rules for iOS App Distribution in the EU. What Do You Need to Know as a Developer?

This spring, a small revolution awaits iPhone users in the EU. Soon, more stores will appear to enable the download of iOS apps outside the App Store. Installing apps directly from the developers’ websites will also be possible.

This means that software developers will have to become familiar with new rules for app distribution.

What exactly will change? Who will benefit from it? And what should you know before launching the app on your website?

Changes in app distribution in the EU

It all started when the European Union created The Digital Markets Act (DMA). Thanks to these new rules, the biggest online platforms should operate in a fair way.

It’s supposed to create new possibilities for smaller businesses because the environment will foster competitiveness more.

The possibility to publish iOS apps outside the App Store is just one example of changes that will occur due to new regulations.

Will the apps outside the App Store be safe?

Users won’t be limited to just one store that meticulously checks all apps before they get published. Fortunately, there’s no need to worry that apps outside the App Store will be dangerous or low-quality. They will still need to meet specific requirements to make their installation on smartphones possible. 

Despite appearances, it’s not a brand-new option for users of Apple devices. It’s been possible to install apps from various sources on desktops for a long time.

Mandatory Notarization Review

Although the complete App Review process, known from the App Store, won’t apply to alternative distribution methods, this doesn’t mean users can install every app.

First, it will have to go through the Notarization Review, where it will be checked for compliance with requirements regarding privacy and safety, among others.

This process should result in approval for distribution. It’s required both for apps distributed in alternative stores and on developers’ websites.

Evaluation process

What does the Notarization Review look like? First, the developers submit a binary and indicate in App Store Connect that they want to publish the app using options for alternative distribution.

Next, Apple workers check the app; automated verification is also conducted. In this process, some specified criteria apply. They are divided into five main categories:

• Accuracy
• Functionality
• Safety
• Security
• Privacy

The app must meet them to get approval for distribution and pass the notarization review successfully. In such a case, Apple will encrypt and sign it. It’s not the end, though. The app will be checked again during its installation on a smartphone.

Who is allowed for web distribution?

Apple introduced some limitations for people who want to distribute iOS apps on their websites. The apps will be available for download only from the domain registered in the App Store Connect. 

Not everyone will be able to have their apps reviewed in the notarization process. First, they need to meet specified criteria:

• Developers must be “members of good standing” in the App Developer Program for at least two consecutive years.
• They must have published at least one app that was installed on iOS devices in the EU over one million times in the previous year. This number is related to the first annual installations.
• They need to figure in the Apple Developer Program as  “an organization incorporated, domiciled, and or registered in the EU or domiciled in its territory”. An alternative can be the developer’s subsidiary legal entity listed in App Store Connect that also is either registered in the EU, domiciled, or incorporated there.

Apart from that, developers will need to agree on taking some actions, such as responding to Apple’s communication, and their approach to data collection policy should be transparent.

They will also be obliged to abide by legal requirements effective in the EU and the countries where they operate. They must also take down the app listing if they receive a request to do so. You can read the requirements in detail on Apple’s website.

The rules above apply to all developers who want to start the Notarization Review, whether they distribute it on their own websites or in an alternative store.

What kind of content will be rejected?

There will be no changes regarding obvious matters related to publishing false information or encouraging dangerous behavior. It still won’t be allowed. Also, you won’t add features that may lead to physical harm, for example.

Theoretically, apps that enable playing for money, such as casinos or sports betting apps, will be able to get approval for distribution after the notarization. Why? Rules regarding lotteries, gaming, and gambling that apply in the case of App Store distribution aren’t included in the Notarization Review. However, this doesn’t change the fact that developers must adjust the app to the legal regulations that are in force in the country where they operate.

New regulations and fees

iOS app distribution involves fees. Creating the Apple Developer Account, required by the App Store, is an annual cost of $99 for individuals and $299 for organizations. Whether you publish the app on Apple’s platform or choose web distribution, you must pay this fee. What will change then?

Commissions from in-app purchases

The commission cost from in-app purchases will be different. It applies to transactions for digital goods and services. Currently, it’s 30% in the first year and 15% in the following years. New rules will reduce these costs. In the case of apps downloaded from the App Store, it will be 10% or 17%.

Payment processing

Developers who distribute the app on the App Store will be charged an additional 3% fee for using its payment processing system. How can you avoid it? It’s best to try out services from other providers of such solutions. Alternatively, you can link to a website that enables payment processing.

A fee for popular apps

In the case of web distribution, you don’t have to worry about the commission, but it doesn’t mean there will be no fees at all. If users have installed a given app more than one million times in the last 12 months, developers start paying Apple €0.50 for every new first annual install. It’s called the Core Technology Fee.

The first annual install is when the app is installed for the first time from an account in 12 months.

Installs from the same account in the following 12 months won’t be charged.

CTF applies to both apps on the App Store and those distributed on the developer’s own websites. Only some educational institutions, governmental agencies, and non-profit organizations that registered on the alternative terms won’t need to pay the CTF.

When should you consider app distribution outside of the App Store?

If you assume the app won’t be installed more than one mln times

If you don’t have to pay Apple costly commissions, new terms will be financially beneficial for many companies planning to develop an iOS app, especially if they decide on web distribution. It depends on how popular their apps will become and whether they will exceed the one million first annual installs limit. Otherwise, they will have to pay the CTF. Fortunately, many apps won’t get past this threshold, so they won’t be charged fees.

However, in the case of alternative marketplaces with apps, you need to consider their own pricing. Check it before choosing their services.

If you’re not sure whether the app will pass the app review on the App Store

The App Store’s App Review process is more restrictive. Notarization Review is just one of its elements. If you want to launch the app as soon as possible, distribute it on your website first. Notarization takes less time and allows you to enter the market earlier. At the same time, you can start the evaluation in the App Store and wait for the decision or make corrections.

If you want to increase your chances of getting new users

Undoubtedly, the App Store platform will remain the first place where many users will look for new apps. They will have the biggest choice there, and it’s also the option they are used to. Nevertheless, the more opportunities you offer, the better. Consider different distribution methods to increase the chances of installs.

We don’t know the exact date when the new possibilities regarding iOS app distribution will become available. It’s best to be up to date, though, and slowly prepare for the upcoming changes.