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    German cartel office initiates proceedings against PayPal

    CNA – Germany’s cartel office regulator said yesterday it had initiated proceedings against payment company PayPal Europe over the possibility that it hindered competition.

    The subject of the proceedings was PayPal’s rules for extra charges and the presentation of PayPal in the terms of use for Germany, the watchdog said. PayPal did not immediately reply to a request for comment.

    The regulator is investigating in particular rules that say merchants may not offer their goods and services at a lower price to customers who choose a cheaper payment method than PayPal.

    PayPal demands that sellers do not express a preference for other payment methods or make their use more convenient for customers, according to the anti-trust watchdog.

    “These clauses could restrict competition and constitute a violation of the prohibition of abuse,” said Cartel Office Chief Andreas Mundt in a statement.

    “We will now examine what market power PayPal has and to what extent online merchants are dependent on offering PayPal as a payment method.”

    The watchdog is closely watching Internet companies to ensure fair competition.

    Paypal is Germany’s leading online payments service but also its most expensive. PHOTO: AFP
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