eBay may appeal ACCC PayPal deal block

With the ACCC appearing likely to stop eBay's exclusive deal with PayPal, the online auction giant has today refused to rule out appealing against an unfavourable decision.

While the Australian Competition and Consumer Commission (ACCC) believes that an exclusive arrangement between eBay and PayPal may have some security benefits for users, the competition watchdog has moved to block eBay's proposed deal with the payment company.

"The ACCC acknowledges that having PayPal as the only payment provider has the potential to deliver some benefits to users, such as increased buyer protection insurance in certain circumstances. However, the ACCC believes that consumers are in the best position to decide which payment method is most suitable for them," said ACCC chairman Graham Samuel in a statement.

"The notified conduct denies them that choice. Accordingly, the ACCC considers that these benefits do not outweigh the anti-competitive effects of the conduct," he said, before ruling that the company delay its move to a singular payment method — PayPal — until 15 July, pending a final decision on the matter.

The online auction giant fired back at the regulator, with a spokesperson saying the company was "disappointed" with the decision, and insisting that its "paramount objective" with the deal is the "safety and security" of eBay's members, but said it will be complying with the ACCC's requirement to extend the availability of other payment methods until the middle of next month.

However, the internet auctioneer has today confirmed the possibility of continuing the dispute past the July deadline — should the ACCC not rule in its favour — after a spokesperson told ZDNet.com.au, that "eBay is not ruling anything out at this stage", following its statement on Friday that "eBay believes the consumer benefits of this initiative are worth fighting for on behalf of its buyers."

Today's response comes after the revelation a fortnight ago that an apparently "anonymous" public submission on the matter — questioning the supposed benefits of an eBay-PayPal deal — was in fact issued by search giant Google.

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Talkback 10 comments

    No? John Fox -- 16/06/08

    What part of "no" doesn't eBay understand?

    Greedy Anonymous -- 16/06/08

    ebay and paypal are the same creature, they want to "to do a Telstra" and maximise their profits.
    http://news.cnet.com/2100-1017-941964.html

    Buyer protection??? Anonymous -- 17/06/08

    We keep hearing about $20,000 buyer and seller protection with PayPal when in truth very few individual transactions would constitute even 2% of this amount.

    One could then fairly safely surmise that for the vast majority of buyers and sellers this statement is more of a red herring than a true benefit

    ACCC Should Look @ State Governments Anonymous -- 17/06/08

    Maybe the ACCC should look at some of the practices of the state governments before going after the private sector. Ask yourself why in South Australia you can't pay your Car Registration with Pay Pal or American Express or Diners Credit Card? It has me a little bit bemused of the double standards that the government applies.

    SA Car registration payments Anonymous -- 17/06/08 (in reply to #320104285)

    I dont think you understand the difference.

    PayPal, AMEX and Diners are only 3 of several different options available to consumers.

    Ebay wants to remove everything except for their own PayPal and Cash on Pickup.

    SA Government have no interests in the banks apart from taxes.

    Paypal is Ebays baby. A fat baby.

    Car Registration with Pay Pal Anonymous -- 17/06/08 (in reply to #320104285)

    Perhaps you should ask why you can't buy your groceries with Paypal? Why you can't buy your petrol with Paypal?

    Sir, you are clouding the issue. Many organisations restrict payment to certain types of credt cards, and the one that is most often excluded is American Express. ... I wonder why that is???

    amex Anonymous -- 19/06/08 (in reply to #320104388)

    because amex charge high merchant fees and rather than pass on the charges (like some smaller supermarkets are now doing with eftpos, chargin you 50c to use it) they opt to not take amex

    the ebay/paypal thing is different...paypal makes money from sellers, ebay effectively want to charge your for selling twice (once on ebay, once on paypal)

    reputation.. Mark Weddington -- 21/06/08

    even if they do drop the paypal only requirements - theyr reputation is destroyed. there are other online auction sites to try out - im watching smartbid.com.au which opens very shortly - looks like a great opportunity for both buyers and sellers.

    www.bang4bucks.com.au Anonymous -- 22/06/08

    I'm listing here now, and it's great to see a true Aussie company listening to their customers - the sellers! They have buyer reward points and run charity auctions to help pensioners, it's great.

    www.smartbid.com.au Anonymous -- 29/06/08

    Just joined this site which opens today and am absolutely wrapped. Goodbye forever Ebay. I was most impressed with their business model. From their site:

    Here was their statement:

    Pencil the first of July 2008 in on your calendar.
    Why? Because this is the date Australians were finally provided with a community auction site, made by users for users.

    Smartbid is a genuine alternative to EBay and the other various spin off auction sites whose not so lofty aspirations seem to be being regarded as the slightly lesser evil.

    The difference? Smartbid is free! You can sell and buy items for no cost.

    How can this work?

    Community!

    The Smartbid business model is so simple yet incomprehensible for other auction sites. We don't mind making it public because we know it's far too radical for the opposition to attempt so here it is:

    Create a community of users and don't rip them off

    Smartbid will charge a minimal charge for some additional extras, if required in order to function as a viable business.

    Smartbid are not going to siphon money from their users so they can advertise on TV and radio. Our strength is our site and the services provided.

    This is the information age and what better method of spreading the word then a base of satisfied Internet savvy users.

    Smartbid are not going to ask how you found their site. They only care about why you found their site.

    - as I said before, Goodbye Ebay

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