When the iPhone 3G launches on July 11 Apple Stores in the UK will not be taking part in the celebrations, only O2 and Carphone Warehouse stores will be selling the newest iPhone.

According to a report Apple and O2 are working out a method in which Apple can sell iPhones through its online and high street retail stores at the O2-subsidised selling price.

The problem occurs because iPhone 3G purchasers will have to activate their new iPhones in-store, and Apple lacks systems to carry out credit checks in its stores.

“We are currently working closely with Apple to enable them to issue contracts in store. Full details are still to be confirmed,” an O2 spokesperson explained.

The O2 spokeswoman also confirmed that pay-as-you-go (prepay) iPhones, which are expected to be sold at the full price, will be sold in Apple stores, as well as O2 and Carphone Warehouse.

The sale price of prepay iPhones is rumoured to be in the region of £350 (8GB) and £450 (16GB).