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WARSAW (Reuters) – Polish regulator UOKiK has started proceedings against PayPal over possible prohibited contractual provisions, it said on Wednesday, adding that the possible fine could amount to 10% of the company’s revenue.
The regulator said it has doubts regarding the payments company’s right to impose contractual penalties, such as blocking access to accounts, financial sanctions, or terminating contracts among others.
UOKiK said that prohibited activities which could incur penalties were described in an unclear way and users may not understand exactly what was not allowed and what action the company could take in such cases.
“Agreements, and especially those parts of them that define the negative consequences of prohibited activities, must be written in simple and comprehensible, but at the same time precise language and based on clearly defined criteria,” the head of UOKiK, Tomasz Chrostny, said in a statement.
PayPal said in an emailed statement that it would respond appropriately to UOKIK on the issue.
“PayPal remains deeply committed to its compliance obligations and the company works closely with regulators around the world to adhere to all applicable rules and regulations in the markets in which we operate,” it said.
(Reporting by Alan Charlish and Anna Koper, additional reporting by Anna Wlodarczak-Semczuk; Editing by Louise Heavens, Kirsten Donovan)