The German Competition Authority Initiates Proceeding Against PayPal

The German Competition Authority (“Bundeskartellamt”) has initiated a proceeding against PayPal (Europe) on account of practices possibly foreclosing competitors and restricting price competition. The proceeding deals with PayPal’s “Rules about surcharging” and the “Presentation of PayPal” set out in its user agreement applicable in Germany.

Under these terms and conditions merchants are not allowed to offer their goods and services at lower prices if customers choose to use a payment method that is cheaper than PayPal.

The fees incurred by sellers for the use of a payment service differ considerably depending on the payment scheme. Sellers usually include these fees in the product prices so that ultimately consumers bear the costs incurred for payment services even if these costs are often not separately charged to consumers.

According to market studies, PayPal is not only the leading online payment scheme in Germany but also one of the most expensive online payment services.

The antitrust proceeding is based on the prohibition of abuse of a dominant position (Article 102 TFEU, Section 19 German Competition Act (“GWB”)) and the prohibition of abuse of a position of relative or superior market power (Section 20 GWB). In addition, PayPal’s conduct might also violate the prohibition of anti-competitive agreements (Article 101 TFEU, Section 1 GWB).

You can reach further information here.

Kind regards,

Zumbul Attorneys at Law

info@zumbul.av.tr