ONLINE auction house eBay Australia has applied for legal protection as it seeks to force members to use a payment gateway it owns for buying and selling goods.
eBay Australia buyers will no longer be able to use direct deposits, personal cheques or money orders to purchase items on the website from June 17
Instead, members will only be allowed to use the eBay-owned PayPal transaction system, or cash on delivery.
The move, first announced on April 10, has drawn the ire of its members and, to add salt to the wound, eBay is using the local market to test the new rules before imposing them globally.
One day after making the announcement, law firm Deacons, representing eBay, filed an "exclusive dealing" notification with the Australian Competition and Consumer Commission (ACCC) requesting immunity from the Trade Practices Act.
Section 47 of the Act prohibits exclusive dealing which broadly involves one trader imposing restrictions on another’s freedom to choose with whom, in what or where it deals. In some cases, exclusive dealing is prohibited outright and, in other cases, only where it substantially lessens competition.
In the documents, Deacons partner Calum Henderson argued that the PayPal-only policy would not substantially lessen competition, and the mandatory procedures were for the sake of security and customer protection.
"In any event, any detriment to the public which may be caused by a lessening of competition as a result of the policy would be outweighed by the significant public benefits that would be likely to result from the move," Mr Henderson said.
"In order to address the issue of problematic or fraudulent transactions and the associated customer churn due to bad buyer experiences, eBay proposes to take advantage of the enhanced security features of PayPal by mandating the use of PayPal for almost all transactions on the eBay site.
"EBay will continue to permit sellers to offer to accept 'pay on pickup', as this payment method is not likely to give rise to bad buyer experiences."
It is the ACCC's policy to grant immediate immunity from the date the notification is validly lodged.
The regulator is expected to post a notice on its public register this week and interested parties can make submissions, an ACCC spokesman said.
The public will have until May 2 to provide submissions.
Meanwhile, an online petition against eBay's new policy has been established by Brisbane small business operator Daniel Gibney.
Over 3500 signatures have been collected and Mr Gibney hopes to exceed five figures.
"I will definitely be forwarding the petition to eBay, although I doubt whether they will do anything about it," he said.
Based in Brisbane, Mr Gibney has been buying and selling on eBay for seven years.
He joins a chorus of fellow members outraged at the double-dipping nature of the new policy.
"If eBay's motives really are pure, why don't they offer to lower fees for sellers, to keep things competitive?" he said. "The new policy is a blatant grab for profits, disguised as a security upgrade."
