eBay Australia faces PayPal fury
Aussies unconvinced by PayPal-only policy
eBay Australia's attempt to force all sellers to use PayPal is failing to win over users and still faces a competition investigation.
The online auction house has suspended introduction of the scheme while the Australian Competition and Consumer Commission investigates it. The ACCC has already said that it is concerned that eBay is using its dominant position in online auctions to lessen competition in another market - online payments.
At a meeting held earlier this week eBay failed to answer users' concerns that the decision was more to do with improving eBay's margins than the purported fraud reductions claimed. Under the proposals all transactions on eBay would have to be made using PayPal or cash on delivery.
eBay's Australian managing director Simon Smith read a prepared statement but refused to answer follow-up questions. The meeting, called by the ACCC, was attended by about 50 people although many claimed to represent hundreds of other traders. Certainly forum discussions on the issue have collected hundreds of responses.
The Australian policy is predicted to spread to the rest of the world - eBay UK made it compulsory to offer PayPal earlier this year but sellers can also offer other payment methods. In the US eBay sellers who ship items outside the country are also required to offer PayPal as an option. ®
Reply - Virtual Trade Ref
The ACCC has no right to enforce it's decision.
The ACCC can say that PayPal must not be the only method of payment, but this will have no outcome that is of any use to consumers.
eBay is well within the law to make PayPal the only "method of payment for which it encourages". And the ACCC is well within the law to enforce that PayPal "is not the only method of payment".
Neither party will say they do not prefer either outcome. eBay can make the use of non PayPal payments so bad that there is no need to want to do so anyway while still allowing other (non pref) payments to be made.
The ACCC can endorse other payments, but has no legal standing to enforce exactly how they must be used. It is well within the rights of the ACCC to "enforce" the users "rights" to use other payments. It is also by these same laws the ACCC must "enforce" the "rights" of the owner of the site to allow a pref. payment method while allowing other payment methods.
The ACCC has no ground with this. And it is of no matter which outcome happens, eBay will have PayPal as it's pref. payment method. It also can (and most likely will) ensure PayPal is used for the majority of all payments by not giving any additional (sellers and owners rights) security to the buyer or seller other than what is shown at the time of the transaction.
eBay will have PayPal pref. very soon. It may well be forced to allow other payment methods. These will be so bad for buyers (and sellers), that they will skip them anyway. As a seller...i can choose what payment methods i accept and as a buyer i can choose which auctions or sales i take part in.
If you don't like them, shop with someone else. That's your right as a buyer.
ACCC has the power
Of course the ACCC has the power. The Trade Practices Act gives it that power. In this case it is a practice called "3rd line forcing" which is where somebody uses market power in one market to force you to consume a 3rd party product and anybody in a market dominant position has to be very careful of it. It's a specific part (s47) of the TPA and not just some general "it's not healthy competition" subjective thing. There's a nice discussion of it at this Law Firm site: http://www.mallesons.com/publications/2005/Nov/8201946w.htm . They quote similar examples like a finance company insisting you use a particular insurer to insure a loan or a car seller insisting you use a certain form of finance. It's illegal.
Another thing people are missing is that the current, interim, situation on eBay AU is almost as bad. Currently you are forced to accept PayPal in addition to whatever other means you want to offer. PayPal must be one of the options. Which means, as a seller, I'm at the whim of a buyer. If somebody decides to use PayPal on my listings, I can't stop them. And it's a lot easier to use PayPal for them than do a bank transfer. I just cop the fees. It's this that I want stopped. I don't want to accept PayPal AT ALL. I wish the ACCC was going further than it currently is.
Ebay makes it impossible to profit selling new computer parts
Hi, the markup on computer parts is terrible, if you sell in an Ebay store, it costs up to 8% when item is sold, and you pay Paypal another 3% to handle the money. How is a computer reseller supposed to make a profit? They don't Ebay does only. Its time Ebay adjusted fees for certain markets. The only thing you can 'profit' on in computer sales is used/discontinued items.