Ebay policy change - unlawful penalty charge?

AlexisV

Just received this:

Late Fee Withdrawal
From PayPal After 180 Days Past Due. The vast majority of our sellers settle their balances on time or before 180 days. eBay will resort to a PayPal withdrawal only after the balance has been overdue 180 days and our other collection efforts have been unsuccessful. We believe this helps level the playing field for the rest of the sellers who pay their bills. Should eBay withdraw late fees, this will not alter the status of a seller's PayPal account or funds remaining after the withdrawal.

Sounds like a penalty charge to me. They don't even mention how much it might be.

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Not sure how you can be party to a contract with a potentially unlawful penalty charge, which doesn't even mention the amount.

soolin

It doesn't mention paying any charges though, just paying what is due.

Whether or not taking late paid fees direct from the linked paypal account without express permission is legal I'm not sure.

AlexisV

Ah, I'm misreading it. It's fees that are late, as opposed to a late fee.

soolin

AlexisV wrote: »

Ah, I'm misreading it. It's fees that are late, as opposed to a late fee.

That's right, and I wonder if in fact the correct reading of it is just as worrying as the incorrect reading?

nikaso

soolin wrote: »

That's right, and I wonder if in fact the correct reading of it is just as worrying as the incorrect reading?

I read it the same as you Soolin, eBay will recover the arrears from the paypal account rather than any "penalty" on top of it.

Alfie_E

soolin wrote: »

Whether or not taking late paid fees direct from the linked paypal account without express permission is legal I'm not sure.

I agree with you and the other posters that it’s badly worded. Assuming it means what we think it means, it’s just an example of set-off. In that definition, look at the circumstances of Mutual Debts. eBay Europe and PayPal Europe are both part of the larger eBay group. If you have an outstanding eBay invoice, you owe the eBay group money. If you have a positive PayPal balance, the eBay group owe you money.

We usually have this turn up in MSE threads on banking, where, for example, the balance of a current account is used to clear a credit card debt. For that, the page I normally link to is the Financial Ombudsman Service’s banking: firms' right of 'set off'. This states that, as set-off is a basic legal principle, it doesn’t have to be in the terms and conditions. Making it explicit and waiting six months seems very reasonable.

soolin

I had noticed on the banking thread that these set off were allowed, much as 'the man in the street' believes they are not. I don't fully understand the requirements for the link between the accounts though and wonder if associated companies like ebay and paypal can still do this 'sweep'? Going back to banking regulations would say Halifax be able to take money from a Bank of Scotland account to clear a credit card?

Obviously I might still be talking tosh and comparing associated companies like Halifax and bank of Scotland (both HBOS) might not be the same as the ebay/paypal set up.

I also suppose in the larger scheme of things it hardly matters anyway as I'm not sure there are many people who refuse to pay their ebay fees for months and months yet still have an active paypal account.

RFW

soolin wrote: »

I had noticed on the banking thread that these set off were allowed, much as 'the man in the street' believes they are not. I don't fully understand the requirements for the link between the accounts though and wonder if associated companies like ebay and paypal can still do this 'sweep'? Going back to banking regulations would say Halifax be able to take money from a Bank of Scotland account to clear a credit card?

They can and do, usually as a last resort before they start suing. The banks search for associated accounts that they can get the money from.

soolin

Thank you for that, I got rather muddled following some of the threads elsewhere with people arguing that 'it's against the law' but without actually providing proof that is the case.

Alfie_E

soolin wrote: »

…I'm not sure there are many people who refuse to pay their ebay fees for months and months yet still have an active paypal account.

It’s just dawned on me what the change is for. eBay/PayPal regularly freeze people’s accounts. This is ostensibly to stop fraud, but we’ve had people post here who’ve had their accounts frozen for minor infractions or for no readily apparent reason. PayPal freeze accounts for 180 days, claiming it protects them against chargebacks. The ex-eBay seller then gets their own money back, six months after the time they needed it. With this change, any outstanding eBay fees at the time the seller was banned will be taken from their PayPal balance, before any remainder is returned.