eBay Mandates US Sellers Take PayPal if They Ship Internationally

eBay sellers around the world are being increasingly forced to accept the company's PayPal payment service. In the US, eBay is requiring that sellers who ship internationally accept international PayPal transactions - Section 4.3 of the PayPal user agreement goes into effect on July 9, 2008. (See update below.)

eBay currently requires all sellers in the UK to accept PayPal in all of their listings, and it is fighting government regulators in Australia over its bid to ban all other payment services in that country.

An AuctionBytes reader said that the requirement of accepting PayPal in the UK effects UK shoppers' ability to view international listings. "What eBay appear to have done is to prevent every listing that doesn't offer Paypal being copied onto the ebay.co.uk servers. So if you do a Worldwide or EU search from ebay.co.uk, then it no longer shows those international listings that don't offer Paypal. Even if you go into Advanced Search and select "Items Located in Any Country/Region," it will not show those listings without Paypal.

"So if you're a German seller who only offers Bank Transfers, or a US seller that only offers Money Orders & Cashier Checks, then potential buyers in the UK will never ever see your listings (well not unless they logon to one of the other ebay sites)."

eBay is also rolling out policies that force sellers to have one payment policy for all sales, domestic and international. eBay rolled out the "Misleading and Discouraging Payments" policy in Australia last fall and rolled it out in the UK this month (http://www2.ebay.com/aw/uk/200806100834552.html).

eBay sellers who sell internationally often choose to limit payment methods on non-domestic transactions for logistical reasons and to limit risk.

In Australia, sellers were upset with the Misleading and Discouraging Payments policy because it did not let them exclude money orders from outside Australia without also excluding money orders from buyers located in Australia. For many Australian sellers, accepting international checks is not viable - in some country areas the local banks simply will not accept them, according to eBay seller Kevin Tyerman in an interview conducted last year (http://www.auctionbytes.com/cab/abn/y07/m11/i13/s01).

Update 6/16/07
PayPal amended today its policy update that goes into effect on July 9 to be clearer about requirements for eBay sellers who ship internationally. Section 4.3 currently has three parts (a through c). PayPal spokesperson Michael Oldenburg sent AuctionBytes a revised copy of section 4.3 showing how it will read, with two additional points (d and e):

Section 4.3: Use of PayPal on eBay. Sellers who offer PayPal as a payment method in their eBay listings must follow these requirements:

a Accept PayPal if the eBay listing includes PayPal as a payment method.

b Accept all PayPal funding sources from a buyer, including but not limited to eCheck and credit cards.

c Have a Premier or Business account or be willing to upgrade to a Premier or Business account upon receipt of a payment.

d Accept international PayPal transactions if the eBay listing offers shipping outside the US.

e Sellers may not charge a surcharge for accepting PayPal as a payment method.

The original update had read, "Section 4.3 is amended so that eBay sellers must accept international PayPal transactions if the eBay listing offers shipping outside the US." Oldenburg said because of the bad language of the original policy update, it was unclear that eBay was not requiring international shippers to accept PayPal. The new policy update actually specifies that if eBay sellers accept PayPal, they must accept it for all transactions, both domestic and international.