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Fuzzy Logic eBay rebels take PayPal issue to the Reserve Bank of Australia
Fuzzy Logic eBay rebels take PayPal issue to the Reserve Bank of Australia | eBay rebels take PayPal issue to the Reserve Bank of Australia |
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| by Alex Zaharov-Reutt | |
| Tuesday, 22 July 2008 | |
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Page 3 of 5 What follows is page 3 of a letter sent to Glenn Stephens, the Chairman of the Reserve Bank of Australia, in italics:Featured Whitepaper
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“Acceptance of PayPal as a payment method can double the amount of fees that a seller pays to eBay/PayPal. Accordingly we believe that this demands that the Public Interest be considered in relation to the behaviour of eBay and PayPal in regard to their payment system. “To this end we request that the provisions of the Payment Systems (Regulation) Act 1998 be enforced. In particular we believe that section 11 (1) of the Act should be utilised to make PayPal a designated payment system because it is in the Public Interest to so do. “Further we believe that the Reserve Bank should invoke section 18 and set standards for the operation of PayPal as it relates to eBay as this is in the Public Interest. Our view is that this matter is so urgent that section 18 (5) should be used to issue urgent standards. “The urgency stems from the fact that eBay’s aggressive tactics to make PayPal the defacto payment method has meant that many eBay members (buyers and sellers) who are unable or less able to adapt to this forced change are becoming unviable and are having to cease trading on eBay. “Such standards should ensure that; “(a) eBay/PayPal deals equally with all payment systems available on its site, (b) eBay does not require as a condition of participating in eBay the acceptance of PayPal as a payment method, (c) eBay/PayPal are prevented from having rules which prohibit the recipients of PayPal payments charging a fee or surcharges for the use of PayPal, (d) PayPal becomes a signatory to the EFT Code of Conduct. “We believe that these measures will promote efficiency and competition in the Australian, online, payment system. “There are very strong Public Interest and Competition issues that we believe compel the Regulation of PayPal as it relates to eBay at least. “The dominance that eBay has over the on line auction market means that if it uses this strength, and the tactics set out above, to enshrine PayPal as the defacto payment standard it will squash all other payment methods. “This will remove choice and allow PayPal to set whatever terms and conditions that it chooses. It will also diminish the possibility that a new player could enter the market. “Failure to be a signatory to the EFT Code of Conduct leaves the users of PayPal open to dangers not associated with PayPal's natural competition, who are all signatories to this Code." Continued on page 4. |
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