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ACCC versus eBay

May 13th, 2008 by Viv


eBay proposes to supply the services offered on the eBay Site to registered users of the eBay Site, on condition that users only acquire the online payment services provided by PayPal Australia Pty Ltd. The ACCC (Australian Competition and Consumer Commission) is considering whether to allow eBay to engage in such exclusive dealing.


It is my submission that the ACCC should have no role to play in regard to eBay’s decision in this matter. That is, so long as eBay is keeping to the terms and conditions to which it offered buyers and sellers when they subscribed to eBay, it is purely a matter for eBay to decide the means of payments they will allow. No doubt eBay realises that some buyers and sellers will not prefer the change and may stop using their site; but that is a commercial decision for eBay to make.

It is claimed that such “restricted” means of payment will “reduce competition.” It is true that fewer payment options will be available. However, in normal business there is no obligation for a merchant to accept all and every form of payment. For example, some merchants do not accept all brands of credit cards, or BPAY. Some do not accept cheques.

It is feared by some that this course of action will somehow enhance eBay’s “monopoly” position in the on-line auction field. However, eBay does not have a monopoly; there are other on-line auction sites, and there is no prohibition (as far as I am aware – nor should there be) on someone setting up another on-line auction site.

If eBay’s buyers and sellers do not like the proposed new arrangement, they can leave eBay and use another service that has terms and conditions more to their liking. So, in fact, that is likely to increase competition. At least one other auction site is advertising by using the phrase, “Hate what eBay is doing?” to attract new customers.

It is not the ACCC’s business (or shouldn’t be), as a third party, to interfere with agreements freely made between two other parties.

Bob Long


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