UK’s competition watchdog fines PayPal over the acquisition of iZettle
Category: #headlines  By Pranali Mehta  Date: 2019-09-26
  • share
  • Twitter
  • Facebook
  • LinkedIn
UK’s competition watchdog fines PayPal over the acquisition of iZettle

In the United Kingdom, CMA (Competition and Markets Authority) is a unit of the non-ministerial government department (NMGD) that is responsible for strengthening business competition and reducing and preventing anti-competitive activities.

The agency was seen in action recently when it reportedly fined online payment giant PayPal Holdings Inc. with $311,000 fine over its $2.2 billion acquisition of Swedish firm iZettle. For the uninitiated, iZettle offers point-of-service hardware and plug-in card readers that enables small businesses to take credit card payments.

In May 2018, the American payment giant acquired the business of iZettle. However, Competition and Markets Authority that year issued an Initial Enforcement Orders (IEO) and ordered PayPal to keep its business separate from iZettle in the UK during the investigation period. Nevertheless, CMA allowed PayPal to integrate two business outside the UK without influencing UK customers. 

According to the Competition and Markets Authority (CMA), PayPal had breached the terms and conditions of initial enforcement order which were issued last Sept. It fined PayPal saying that, despite its assurance, PayPal conducted cross-selling pilot campaigns that intended to target customers in Germany and France which eventually leads in contacting UK potential customers.

Previously, CMA gave green light to this acquisition in June but is still fining PayPal for breaching its order. According to the regulator, a £250,000 fine is a proportionate amount of penalty, given to the severity of the breach. This fine is considerably less than maximum penalty which is of 5% of PayPal's turnover.

In response to the allegations, a spokesperson from PayPal said that the company respectfully disagrees with CMA’s report, however, understand the importance of IEOs in UK’s merger control regime. The CMA has acknowledged that the alleged infractions that led to this fine were not intentional and had no impact in practice.

The spokesperson added that, while the company is disappointed with this outcome, it takes compliance seriously and has learned a lot from this process.

Source Credit - https://www.businessinsider.in/PayPal-was-just-fined-311000-by-a-UK-regulator-over-its-2-2-billion-iZettle-acquisition/articleshow/71276279.cms

  • share
  • Twitter
  • Facebook
  • LinkedIn

About Author

Pranali Mehta

Pranali Mehta    

Pranali Mehta boasts of over three years of experience as a content writer. Having completed her graduation in chemical engineering, she worked as safety & environment associate in a chemical company for a year. Harnessing her passion for writing however, Pranali deci...

Read More >>

More News By Pranali Mehta

Bluesource to head Michigan DNR' carbon credit marketing project
Bluesource to head Michigan DNR' carbon credit marketing project
By Pranali Mehta

Officials in Michigan, Detroit have taken the sustainable route to curb the region’s carbon footprint through credits. As per the latest news, a Salt Lake City firm named Bluesource Corp. has been chosen by the Michigan Department of Natural Re...

Moovaz enters deal to acquire on-demand van rental service, GetVan
Moovaz enters deal to acquire on-demand van rental service, GetVan
By Pranali Mehta

Moovaz, a Singapore-based logistics company that provides relocation services, has reportedly entered an agreement to acquire GetVan, an on-demand van rental service provider. Financial terms of the agreement have not been disclosed. As per the stat...

Brazil’s Petrobras Resumes Oil Trade with World’s Major Traders
Brazil’s Petrobras Resumes Oil Trade with World’s Major Traders
By Pranali Mehta

Petrobras, Brazil’s state-held oil firm announced that it is restarting trades with the world’s leading oil trading houses Trafigura, Vitol, and Glencore after almost 2 years of suspension amidst a bribery inquiry in between the oil tradi...