PayPal unconcerned over anti-competitive claims
Select language to see a machine translation of this article. The original language of the Article is English and the translation is provided for your convenience.

PayPal unconcerned over anti-competitive claims

When online payments giant PayPal closed its acquisition of iZettle, it made the biggest purchase in its history. Now, regulators in the UK say that might have been a mistake. Britain’s antitrust watchdog, the Competition and Markets Authority (CMA) says that PayPal might “face insufficient competition in the UK after acquiring its market-leading rival.” On Tuesday, the company’s cehif operating officer said it was “engaging positively” with the CMA, and investors had nothing to worry about.

PayPal’s share price has appreciated by 15% year to date

paypal g 071218

Source: Yahoo Finance

The CMA raised concerns that PayPal’s $2.2 billion acquisition of iZettle, a European fintech start-up based in Sweden, could lead to higher prices for online payments services and less competition. At the Slush Technology conference in Helsinki this week, PayPal’s chief operating officer Bill Ready spoke directly to those concerns.

He said: “We absolutely believe that we will demonstrate that we are bringing more choice (and that) we are pro-competition. We are really looking to expand the market in ways that are great for small business and great for consumers alike.” He added that the company was working with the CMA to address its complaint.

And here is that complaint. In a statement, Andrea Gomes da Silva, the regulator’s executive director, said: “While iZettle is a relatively recent entrant to payment services, it has already established a market-leading position in mobile point of sale devices and was well-placed to compete against PayPal in other emerging markets. That’s why we are concerned that PayPal’s takeover could lead to higher prices or reduce the quality of the services available to customers.”

As the story continues to play out, we’ll keep you updated.

Dominion holds PayPal in its Global Trends Ecommerce Fund.

If you would you like to receive the Newsfeeds daily, please click here to sign up now!

Help us make this Newsfeed better by rating this article. 1 star = Poor and 5 stars = Excellent
0.0/5 rating (0 votes)

The views expressed in this article are those of the author at the date of publication and not necessarily those of Dominion Fund Management Limited. The content of this article is not intended as investment advice and will not be updated after publication. Images, video, quotations from literature and any such material which may be subject to copyright is reproduced in whole or in part in this article on the basis of Fair use as applied to news reporting and journalistic comment on events.