eBay's anti-competitive banning of the UK's NoChex service has users in uproar

[mandy]

British traders have slammed an unexpected move by eBay to prune the range of payment methods it accepts. On Friday morning, Pacific Time - Friday evening in Europe - eBay declared that Nochex, a Leeds-based payment gateway, was no longer acceptable as a payment mechanism. Google's new Checkout service also found itself in the sin bin.

But traders say that the abrupt notification left them scrambling over the weekend to avoid being delisted.

"It's a complete ballsup - they've really mismanaged this," one British PowerSeller told us. "It's extremely aggravating as it means a major change in the way we operate - and puts us at risk of losing our accounts," said the trader, who requested anonymity...

full article: http://www.theregister.co.uk/2006/07/11/...x_fallout/

eBay UK forums, no announcement made that the UK's #2 payment service NoChex (PayPal is #1) which had been used on the site by sellers for 6 years had been banned:

http://forums.ebay.co.uk/thread.jspa?threadID=1200017795&tstart=0

UK eBay sellers may file a complaint about eBay's anti-competitive action with the government's OFT:

Office of Fair Trading, Fleetbank House, 2-6 Salisbury Square, London, EC4Y 8JX.
tel: 020 7211 8000
email: brian.woo@oft.gsi.gov.uk

FYI, payment service NoChex is regulated by the UK"S financial regulator FSA.

[mandy]

eBay very quietly returned NoChex to its accepted payment list a few hours ago after NoChex issued a press release that hinted at plans to bring an anti-trust complaint to the EU against eBay.

The press release NoChex issued earlier in the day:

Nochex, the UK's leading independent online payment services provider has been banned from eBay®, along with Google™ and a string of other payment service providers.
 
 

Martin Greenbank, CEO of Nochex said, "We discovered the ban, which was made without consultation with us, or our customers. It looks like a knee-jerk reaction as it was made within two days of the Google Checkout launch. The ban comes on top of reports in the New York Times that eBay are losing key executives and have seen 45% of their share value wiped out, so eBay may well be rattled. But our main concern is for our customers who are denied the choice of using a well-proven, cost-effective, secure payment services provider with a UK-based support service. That is an important ingredient in giving UK businesses the confidence to grow an ecommerce business effectively.”

"eBay has updated their accepted payment policy to exclude Nochex and Google along with a host of other players to effectively limit payment options to their own PayPal, or a few much smaller, lesser known providers. And we have seen media reports that sellers who continue to promote the Google option will be excluded from eBay. We don't know yet whether the veto will be extended to other payment providers.”

"I really wonder what the EU Competition Commission will make of this move as they are already mounting an enquiry into competition within the payment cards industry. I would have thought this would be a relatively easy add-on? This move certainly reduces the payment services options available, especially if an online trader or buyer wants to use a provider with an established UK-based support service.”

"Fortunately, our core business is in providing online traders with cost effective all-in-one Merchant Accounts. During this year we have experienced fantastic growth with an increased number of eMoney merchant accounts being opened, and we are currently seeing an even greater increase in new merchant account applications. This growth appears to be driven by traders migrating from eBay®.”

"Whether that made us more of a threat to eBay's own payment service provider, I don't know. Judging from the outrage already being expressed on eBay's own customer forum, they may have scored a significant own goal by acting in such an anti-competitive manner. We are expecting a continued increase in Merchant Applications as sellers migrate from eBay and setup shop on their own"
“The UK payment industry is demonstrating unprecedented growth and we see Google’s entrance into the market as a positive sign, which will in turn, create a competitive market and give greater consumer choice.”
ENDS (Nochex Press FactFile follows)

Nochex – Press FactFile

• Nochex is an independent, privately-held company based in Leeds, England.
• Founded in 1999, Nochex has been providing individuals and small businesses with a secure, reliable electronic payment service in the UK since January 2001.
• The payment system was initially adopted by UK auction website users for person-to-person payments, but is now more active providing affordable internet merchant services and online payment services for web-shop owners, primarily for small and medium sized businesses selling online in the UK.
• Nochex is focussed on providing a reliable, trust-worthy internet payment system that is both competitive and, most importantly, secure, with good customer support services.
• A key benefit is that Nochex is easy to use, so more sales transactions are completed through Nochex than many other online service providers, boosting our ecommerce clients’ sales by as much as 24%.
• Nochex has around one million registered users in the UK, and continues to increase rapidly.

[mandy]

eBay UK sellers on the ban and reinstatement of NoChex:

One eBay trader said that auction giant's stealth hide-and-seek communications policy had added to the confusion

"So is this another cockup, or have they genuinely changed policy? There's no announcement yet again - just a quiet change of a page. The guys who have been changing thousands of listings to comply with the "old" new rules are needless to say not happy."...

"People dropped family plans to get their listings changed, because they worried about losing their accounts. Other larger sellers have been editing since last Friday and are furious that it has all been a waste of time," he told us.

full article: http://www.theregister.co.uk/2006/07/13/...ks_nochex/

[rejoicemusic]

The inmates are really running the asylum, aren't they?  Funny how the hint of anti-trust made them change their mind.  Anyone know how the UK courts are in determining anti-trust?

[Kristijntje]

[quote author=rejoicemusic link=topic=4374.msg17639#msg17639 date=1152885799]
The inmates are really running the asylum, aren't they?  Funny how the hint of anti-trust made them change their mind.  Anyone know how the UK courts are in determining anti-trust?

[/quote]

The case would have been tried by the EU.  eBay's decision to avoid the EU may have been influenced by 2 decisions the EU handed down this week:

EU court throws out merger of Sony, Bertelsmann units
EU fines Microsoft Corp. $357m