Pas Palter-Must commercially baked bread be Pas Yisrael:
When the Sages initially enacted the decree against eating the bread of a gentile, the decree applied towards all bread baked by a gentile, whether it is bread baked within the private home of a gentile, or bread baked by a gentile owned commercial bakery. Nonetheless, due to reasons to be explained, there exist certain Halachic leniencies regarding commercial bread of a gentile. Commercial bread is referred to as Pas Paltar, literally meaning the bread of a baker, while privately baked bread is referred to as Pas Baal Habayis.
Important note 1: All leniencies associated with eating gentile baked bread only apply when the bread is under a reliable Kashrus agency which supervises that the bread does not contain any non-Kosher ingredients.
Important note 2: This leniency towards commercial bread is only applicable towards the prohibition of Pas Akum and not to the prohibition of Bishul Akum. Hence any food that is forbidden due to Bishul Akum is forbidden even if commercially made. Thus, those Mezonos foods which fall under the prohibition of Bishul Akum rather than Pas Akum, as explained in the previous Halacha, do not retain any leniency if they are commercially made.
The definition: Any bread that is baked for the purpose of being sold has the status of Pas Paltar, commercial bread, even if the person is not a baker by profession [and the bread was baked in the privacy of his home rather than a bakery]. Only those breads that are baked by a gentile for the purpose of being eaten by him and his family have the status of Pas Baal Habayis. This applies even if the person is a professional baker [and bakes it in a bakery] nevertheless, if he baked it for the sake of his family it is considered Pas Baal Habayis.
The law and custom: The Sages initially prohibited eating any bread of a gentile, whether the bread is baked within the private home of a gentile for his personal use, and whether the bread is baked by a gentile owned commercial bakery. Nevertheless, there are communities which are lenient in a time of need to eat commercially baked bread of a gentile, such as if there is no Jewish bakery bread available in that city [or if there is not enough Jewish baked bread to serve all the Jewish inhabitants]. Some Poskim rule that those communities which are lenient in the above may be lenient to purchase gentile baked commercial bread even when Jewish baked bread is available, if the gentile bakery bread is of greater quality or of different grains than the Jewish baked bread. Furthermore, some Poskim rule that even in places where Jewish bakery bread is available [and of equal or greater quality] it is permitted to purchase and eat gentile baked commercial bread. Practically, the widespread [Ashkenazi] custom is to be lenient like this latter opinion and permit purchasing and eating gentile baked commercial bread in all cases. [However, the Sephardi custom is like the first opinion which only allows purchasing gentile commercial bread in a time of need, and only in those communities which have a custom to be lenient.]
The proper conduct: Despite the above custom of leniency, it is proper even for Ashkenazi Jewry to be stringent throughout the year to purchase and eat only Jewish baked bread, and not gentile commercial bread, if there is Jewish baked bread available and of equal taste and quality. [Practically, Chassidim and other meticulous Jews are particular to never eat gentile bread even if it is commercially baked and is of better quality and Jewish bread is not available, and they only eat Pas Yisrael throughout the year.]
Ten days of repentance: During the ten days of repentance one should be especially particular to only eat Pas Yisrael [bread baked by a Jew], even if his custom is to be lenient in eating Pas Paltar throughout the rest of the year.
From the letter of the law, it is permitted to eat commercially baked bread of a gentile if there is no Jewish bakery bread available in that city [or if there is not enough Jewish baked bread to serve all the Jewish inhabitants] or if the gentile bakery bread is of greater quality or of different grains than the Jewish baked bread. Furthermore, the widespread [Ashkenazi] custom is to be lenient in purchasing and eating gentile baked commercial bread in all cases, even if Jewish bread of equal quality is available. Practically, it is proper even for Ashkenazi Jewry to be stringent throughout the year to purchase and eat only Jewish baked bread, if there is Jewish baked bread available and of equal taste and quality. Chassidim and other meticulous Jews are particular to never eat gentile bread even if it is commercially baked and is of better quality and Jewish bread is not available, and they only eat Pas Yisrael throughout the year.
 See Michaber Y.D. 112:2
 Rama 112:2; Implication of Beis Yosef
 The reason: Even if the person is a professional baker which serves the public, when he bakes bread for himself having a Jew partake in this bread contains a worry of potentially unwarranted closeness, and hence regarding this bread he is considered a Baal Habayis. [Shach 112:11]
 See Shach 112:8 and Aruch Hashulchan 112:7-9 that all Poskim agree that initially the decree was against all forms of bread, even commercially baked.
 Kneses Hagedola 112:11; Birkeiy Yosef 112:7; Zivcheiy Tzedek 112:14 that so is the custom in Bagdad; Kaf Hachaim 112:30
If the Jewish bread is of better quality: Even if the Jewish baked bread is of greater quality than that of the gentile’s, nevertheless if there is not enough bread for all the Jewish inhabitants one may purchase the bread from a gentile. [Poskim ibid]
 Michaber 112:2; Rambam 17:12; Rashba; Ran; 2nd opinion in Tur; Yerushalmi Perek Ein Mamimdim
The reason: The reason for this leniency, despite the above Rabbinical prohibition, is because the decree against gentile baked bread did not spread out to all Jewish communities at the time of the decree in the days of the Tanaaim. [Taz 112:4; Tosafus 35b; Mordechai brought in Shach 112:8] Alternatively, in truth the decree did spread out throughout all the Jewish communities, and the reason for this leniency is because it was a very difficult decree to abide by, as man lives off bread, and for this reason the Sages retracted their original decree, and revised it to only apply against personal bread of a gentile and not against the commercially baked bread of a gentile, in a case that Jewish bread is not available. [Shach 112:8 based on Yerushalmi Perek Ein Mamidim; See Aruch Hashulchan 112:3] According to the first reason the entire prohibition against Pas Akum was never accepted and is hence not in force, while according to second reason the decree is in force although under new revisions. The practical ramification between these reasons is regarding a) May one be lenient to eat gentile commercial bread even if Jewish bread is available. [first reason-yes, second reason-no] b) May one be lenient to eat Pas Baal Habayis. [first reason-yes, second reason-no]. In general, the Michaber ibid learns like the second reason, while the Rama learns like the first reason. [See Shach ibid; Aruch Hashulchan 112:7-9] Nevertheless, even according to the Rama, Pas Baal Habayis is forbidden as explained in the next Halacha.
 Opinion in Michaber 112:5; Tur in name of Rashba; Ran
 Michaber 112:5
The reason: As since one enjoys more the gentile baked bread due to it being of greater quality in his eyes, it is thus considered a time of need on his behalf. [Michaber ibid]
 Rama ibid; Mordechai; Smak; Hagahos Ashri; Issur Viheter 44
 The reason: The reason for this leniency is because the Rabbinical decree at that time was not widespread and consequently there were places which never enacted any prohibition in this matter. [Taz 112:4; Shach 112:8; Mordechai] This follows the first reason mentioned above in previous footnotes, as opposed to the 2nd reason which is seemingly held by the Michaber.
 Shach 112:9; Bach 112; Toras Chatas 75
 See Kaf Hachaim 112:24
 Shach 112:9;
 If however the Pas Akum is tastier or of better quality, then the Shach and other Poskim do not state there is any need to be stringnet, as in such a case even the Michaber permits it in a place where it is the custom to be lenient. [Shach ibid]
 Seemingly this is in order to suspect for the initial decree which did not contain such leniencies and as rule the Poskim regarding Aseres Yimei Teshuvah.
 603:1; Michaber 603:1; M”B 603:1; Shach Yoreh Deah 112:9; Toras Chatas 75; based on Yerushalmi Shabbos 3:3