Friday, June 13th, 2008
eBay Responds to ACCC Draft Notice
Earlier this week, the Australian Competition and Consumer commission (ACCC) issued a draft notice that proposed to revoke eBay’s Safer Payments Initiative in Australia.
“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.” — ACCC Chairman, Mr Graeme Samuel.
I wanted to wait until I received official word from eBay regarding the draft notice before posting here on Ink… the following statement was issued early this morning:
ACCC draft notice undermines online consumer protection
eBay will continue to fight for safety benefits for consumers
13 June 2008: eBay challenges yesterday’s Australian Competition and Consumer Commission’s (ACCC) draft notice and is disappointed that the ACCC’s current view delays the opportunity to provide consumers a more secure way to shop on eBay.com.au with confidence.
eBay intends to work with the ACCC and hopes to achieve a final outcome which has the safety and security of eBay’s members as its paramount objective. eBay will delay the removal of other payment methods from the site until Tuesday 15 July.
PayPal offers consumers a range of payment choices, including bank transfer and credit cards. It’s a safer and easier online payment system that significantly enhances protection for eBay buyers and sellers.
eBay is pleased to confirm that PayPal buyer protection will jump to $20,000 on eBay.com.au for purchases paid for using PayPal from Tuesday 17 June.
eBay believes the consumer benefits of this initiative are worth fighting for on behalf of its buyers which will ultimately benefit sellers.
I’ll see if I can get more information regarding the current situation but wanted to share the latest with you now.
Cheers,
RBH
Tagged: accc, ebay, ebay+australia, ecommerce, paypal, safer+payments
TWOn 06.13.2008 at 9:26 am Said:
Always in the name of “safety benefits”. Seems the ACCC realizes this for what it is …. a grab for money pure and simple.
I don’t think eBay is fooling anybody here.
dimesOn 06.13.2008 at 10:27 am Said:
eBay isn’t doing itself any favors by placing an announcement on its website accusing the ACCC of “undermining” consumer safety.
It will certainly limit its ability to “work with” that organization, unless what it meant to say was “work on”.
This must have been written by the same person who compared customers who demand payment choice with heroin addicts.
Unfortunately for eBay, there is no way it will be able to convince anyone that paypal is the safest payment option, because everyone knows that the primary beneficiary of that protection is invariably paypal.
TheBrewsNewsOn 06.13.2008 at 10:27 am Said:
What an appropriate post for Friday the 13th.
There are statistics that prove that Paraskevidekatriaphobics (people afflicted with a morbid, irrational fear of Friday the 13th)
also have Paypaltakeovertheworldaphobics (people afflicted with a very real and rational fear of PayPal world domination)
and so eBay’s response today (on Friday the 13th) to the ACCC has been credited with contributing to more than 2.1 million Australian workers calling in sick to work today and shopping on an Oz only auction service which offers Payment Choices.
These poor afflicted folks can’t leave their home today because they have a fear of Friday the 13th and they can’t shop on eBay because they have a fear of Paypal World Domination so they are forced to spend the day in front of their computer buying from Aussie sellers who don’t want to wait for the “ultimate” benefit of a PayPal only auction site.
Patricia1On 06.13.2008 at 10:47 am Said:
“Ebay - still number one in burning bridges behind them!” 
I’m just full of one-liners today - perhaps they’ll be read?
AmberOn 06.13.2008 at 12:11 pm Said:
that significantly enhances protection for eBay buyers and sellers
The fatal flaw in the entire argument rests above.
Paypal is not safe for sellers.
Paypal offers NO protection for buyers superior to other competitors–especially Aussie based Paymate.
Paypal and eBay’s rate of fraud is HIGHER than direct transfer.
I am delighted the ACCC saw eBay’s moves as the anti-competitive action it was. It has never been about safety. It’s been about forcing all transactions to be processed by Paypal to get the increased fees. No one was fooled into thinking otherwise.
Here is a more thorough quote from the ACCC re: their draft notice. It clearly shows that the concerns of Australian BUYERS and sellers were heard loud and clear.
“The ACCC is concerned that the notified conduct will allow eBay to use its market power in the supply of online marketplaces to substantially lessen competition in the market in which PayPal operates,” ACCC Chairman, Mr Graeme Samuel, said today.
“PayPal currently competes with a range of other providers to supply online payment services to users of online marketplaces. If the notified conduct is allowed to go ahead, there will be no competition for the supply of such services to buyers and sellers using eBay.
“Given eBay’s position as Australia’s leading online marketplace, the notified conduct will substantially reduce competition to supply online payment services to users of online marketplaces more generally.
“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.
“The notified conduct denies them that choice. Accordingly, the ACCC considers that these benefits do not outweigh the anti-competitive effects of the conduct,” Mr Samuel said.
AmberOn 06.13.2008 at 12:24 pm Said:
PayPal offers consumers a range of payment choices, including bank transfer and credit cards.
Wrong. It offers BUYERS the range of payment options. It does not offer SELLERS the range of payment services. Another BIG flaw. Buyers may be the end-all of policy now at eBay, but it’s clear that the ACCC sees both buyers AND sellers as important parts of the eBay economy.
Add to that, the fact that bank transfer takes 3 times longer to be processed via Paypal than when it is done the “traditional” way.
Sellers are able to receive payments for free with bank transfer–charge them for the same service and prices will rise. A direct negative result for BUYERS.
Not to mention the fact that glitches with Paypal have paralyzed some ecommerce sites for WEEKS without so much as an announcement by Paypal, let alone a solution.
You’d think with all of the money they’re now getting in fees from the UK and elsewhere, they’d be able to afford a lawyer with better arguments than these.
AmberOn 06.13.2008 at 1:33 pm Said:
Wow.
Just Wow.
Here’s what the announcement is telling the people of ebay au:
What does this mean for you?
PayPal Buyer Protection will still increase to $20,000 on 17 June 2008.
From 15 July 2008, the only payment methods sellers may offer on eBay.com.au will be PayPal and pay on pick up.
Selling on eBay.com.au
Current policies regarding accepted payment methods do still apply. This means PayPal is required on all listings on eBay.com.au. Other payment methods (i.e. bank deposit, cheque/money order) may also be offered until 15 July 2008.
As previously communicated any listings that do not comply with eBay’s Accepted Payments Policy will be removed.
So they’re still hoping to force sellers to make the change and are defying the ACCC. I guess they’ll force everyone to change their listings and wait to get prosecuted.
Patricia1On 06.13.2008 at 2:46 pm Said:
And on their listing form - two announcements:
eBay and PayPal are making buying on eBay safer. Effective 21 May 2008, all sellers must offer PayPal as a payment method in their listings. Starting 17 June 2008, PayPal will be the only payment option sellers can offer in listings.
Attention!
All items listed for sale on eBay.com.au on or after 17 June 2008 will be subject to the following changes:
* You must offer PayPal on your listings.
* Pay on pick up (ie paid for when picking up the item) can be offered in conjunction with PayPal.
* No other payment methods can be added to your listing.
A small number of exclusions will apply to these changes.
I went thru the bother of checking to see what a 35 cent listing would cost there - $1.09! with a gallery pic. I thought they were hitting us hard 
AmberOn 06.13.2008 at 3:42 pm Said:
I list over there all of the time–but I sell books, so don’t bother w/ the gallery pic.
The AU$ is gaining strength against the US$ and there are still plenty of things that just aren’t available Down Under. Since their postage is pricey also, they don’t mind paying a premium in shipping to get items not normally available to them.
I think the rates need to be adjusted to reflect the weakness of the US $. A few years ago, the fees were pretty comparable considering the exchange rate.
TheBrewsNewsOn 06.13.2008 at 3:53 pm Said:
@Patricia
I’m not sure how you got the $1.09 insertion fee?
Insertion Fees for eBay Australia (note that amounts are in Australian dollars which I believe is about 1 U.S. dollar to 0.94 Australian dollar today)
Starting or Reserve Price
Insertion Fee
AU$0.01 - AU$0.99
Insertion Fee - AU$0.30
AU$1.00 - AU$19.99
Insertion Fee - AU$0.50
AU$20.00 - AU$49.99
Insertion Fee - AU$0.75
AU$50.00 - AU$99.99
Insertion Fee - AU$1.50
AU$100.00 - AU$399.99
Insertion Fee - AU$2.50
AU$400.00 and up
Insertion Fee - AU$3.50
SandiOn 06.13.2008 at 4:17 pm Said:
Richard, why are posts dissapearing? It’s weird, one minute they are there, next mnute they are gone. Is the site having technical issues?
MechelleOn 06.13.2008 at 4:41 pm Said:
I find this portion of PayPal Buyer Protection particularly interesting in relation to the self prescribed safest payment option.
13.15 Relationship between PayPal Protection Programs and Chargeback Rights. The following information relates to reimbursement for losses from purchases where you used a credit card to fund a PayPal purchase:
Credit card chargeback rights, if they apply, are broader than PayPal Buyer Protection: among other things chargeback rights are not limited to $2,000.00 USD per transaction, can be filed more than 45 days after the transaction, and may cover unsatisfactory items even if they are not Significantly Not as Described.
CREDIT CARD CHARGEBACK RIGHTS ARE BROADER THAN PAYPAL PROTECTION:
WITH A CREDIT CARD YOU ARE COVERED WITH CHARGEBACK RIGHTS BEYOND PAYPAL’S MAX OF 2000.00
WITH CREDIT CARD CHARGEBACK RIGHTS YOU CAN FILE A COMPLAINT OUTSIDE OF 45 DAYS
CREDIT CARD CHARGEBACKS MAY ALSO COVER DISSATISFACTION OF THE PRODUCT EVEN IF THEY ARE NOT SIGNIFICANTLY NOT AS DESCRIBED
You can choose to file a Dispute through our Online Dispute Resolution process and escalate the Dispute into a Claim or to exercise your Chargeback rights. However, you cannot pursue both at the same time or seek a double recovery. If you initiate a Dispute through the Online Dispute Resolution process and you then, while the Dispute or Claim is pending, file a Chargeback, PayPal will cancel your Dispute or Claim, and you will have to rely solely on your Chargeback rights.
OPTION OF FILING A PAYPAL DISPUTE OR EXCERCISE YOUR CHARGEBACK RIGHTS
If you close your Dispute or it is otherwise closed, or if you cancel a Claim or it is denied or results in no refund, you may still be able to pursue Chargeback rights.
IF YOUR PAYPAL DISPUTE IS CLOSED WITHOUT REFUND YOU STILL HAVE THE OPTION OF A CHARGEBACK
Well, I’m convinced- paypal provided a very persuasive arguement - a credit card will protect a buyer better than paypal.
They think it is so much more beneficial for the buyer they are practically telling the buyer they would be stupid to use paypal dispute over filing a chargeback.
Now why would paypal do such a thing??? oh, I almost forgot, because they get a fat fee from the seller every time a chargeback is filed.
SandiOn 06.13.2008 at 4:57 pm Said:
They think it is so much more beneficial for the buyer they are practically telling the buyer they would be stupid to use paypal dispute over filing a chargeback.
Because they are legally required to. Paypal really is nothing more than a merchant account. They just happen to let others use it. My company has a merchant account, we sign a contract that states we will not limit in any way chargeback rights. Paypal signed the same thing.
Honestly if Paypal had a choice, they would say no chargebacks :-). Chargebacks cost paypal monies in multiple ways.
Now why would paypal do such a thing??? oh, I almost forgot, because they get a fat fee from the seller every time a chargeback is filed.
We all know what paypal charges us for the favor of using their merchant account. Paypal is also charged per transaction - one of the reasons why they push buyers to use checking accounts vs credit card is it is cheaper for paypal - although they do not pass the savings on to sellers.
Merchant accounts can be taken away. Buy.com actually almost lost theirs a couple of years ago, (it was in the news, and public record). Paypal’s rate is based on vol. and chargebacks. The volumne lowers the rate, chargeback’s raise the rates. Too many chargebacks could also cause Paypal to lose its merchant account.
To be fair regarding the fee Paypal charges, they only charge it in certain circumstances.
MechelleOn 06.13.2008 at 5:26 pm Said:
They are legally required to inform card users of their chargeback rights- ok
So your telling me that visa/mastercard told PayPal that not only must they inform the consumer of their right to chargeback, but they have to do it within paypal’s buyer protection service description? That just doesn’t fly with me
About chargeback fees
They only waive the fee if the chargeback is denied- I am instersted in paypal’s success in winning chargeback disputes? Yesterday someone mentioned they had gone through 12 chargeback disputes using paypal and lost all of them- on the flip side he has had 4 with Amazon and has won all of them.
When I read that portion of the agreement they will reimburse the fees if the chargeback dispute favors the seller. If you wouldn’t mind referring me to the section where paypal says in chargeback disputes fees are not always applied? does it specify which circumstances the fee applies and in which they do not?
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