eBay rebels take PayPal issue to the Reserve Bank of Australia

Alex Zaharov-Reutt
Tuesday, 22 July 2008 07:24

Opinion and Analysis

What follows is page 5 of a letter sent to Glenn Stephens, the Chairman of the Reserve Bank of Australia, in italics, with the following being more “background information for eBay members”:

“If a participant in a designated payment system fails to comply with a direction of the RBA, this is a criminal offence against the Commonwealth. The maximum penalty for a body corporate is a fine of $11 million plus $1.1 million for every day it fails to comply with the direction.

“eBay members may recall that in its recent submission to the ACCC, the Australian Securities and Investment Commission ("ASIC") made the following statement:

"ASIC considers that it is highly desirable that PayPal become a signatory to the EFT Code, given the large numbers of retail customers who use eBay, as it would provide an additional desirable layer of consumer protection that is not currently in place."  

“ASIC is Australia’s corporate, markets and financial services regulator which contributes to Australia’s economic reputation and wellbeing by ensuring that Australia’s financial markets are fair and transparent, supported by confident and informed investors and consumers.

“Further, eBay members may be interested to know that on 27 April 2006 the RBA released a package of reforms which included:

 "…. requiring the Visa system to remove the restrictions on merchants that require them to accept Visa Debit cards if they accept Visa credit cards, and that prohibit merchants from imposing a surcharge on Visa Debit transactions." 

“Our view is that the arguments which led to these reforms are analogous to the current situation where eBay requires sellers to offer PayPal and restricts sellers from imposing a surcharge on PayPal transactions.

Further reading :

PSB: Responsibilities and Powers.

Payment Systems (Regulation) Act 1998  - link here.

RBA submission to the ACCC of 2 May, 2008.

ASIC submission to the ACCC of 5 May, 2008.

RBA media release 27 April 2006.

RBA Standard on "Honour all Cards" Rule and "No Surcharge" Rule.

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Once again, what eBay's response will be to this latest action will be very interesting to see. As yet eBay appears to have made no official format responses to any of the previous actions of the eBay rebellion as yet.