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PayPal is Breaking N.A.F.T.A. (North American Free Trade Agreement) Laws
By Sean Ross
December 28, 2010

Dear Mr. Stephen Joseph Harper,

PayPal called me today and told me that I am not allowed to sell Playboy magazines, Penthouse magazines, or any other adult products using their service because I am a Canadian merchant. I asked them why American sellers were allowed to sell these items using PayPal but not Canadians, and they said it was because they had taken this business decision and they were not going to change it.

I explained to them that allowing Americans to sell adult products but not Canadians was discriminatory, bias, and in direct contravention of NAFTA regulations. They said that they didn't care and if I didn't stop selling these items they would freeze the thousands of dollars in my account and close it.

Here is PayPal's policy concerning the sale of adult products:

PayPal allows U.S. only transactions for certain sexually oriented physical goods, such as videos, DVDs, magazines, or other products physically delivered to the customer. PayPal does not permit transactions for sexually oriented physical goods by users outside the U.S.

There is a dire economic impact to Canadians based on PayPal's decision. The adult products market is a multi-billion dollar market and eBay contributes to a large percentage of sales of these items. The problem is that eBay owns PayPal and they are symbiotically connected. An eBay seller who does not accept PayPal as a payment option has a very small chance of selling his/her product on eBay. This leaves almost no opportunity for Canadian sellers to sell adult products on eBay and prevents them from accepting PayPal for the sale of their merchandise on their own Web Sites as well. Many Web site companies claim that up to 30% of their sales come from the fact that they accept PayPal as a payment option. I am being conservative when I state that the implications of this illegal PayPal decision is costing Canadian adult product sellers hundreds of millions of dollars per year in revenue which relates to tens of millions of dollars in lost tax revenue for Canadians.

I need the Candian Government to force PayPal to abide by NAFTA rules. If PayPal allows Americans to sell adult products then they should be forced to allow Canadians to sell the same adult products, otherwise they are restraining trade for Canadian merchants, thereby stealing millions of dollars in tax revenue from Canadian citizens.

Please protect Canadians from American companies who deem it justifiable to protect American companies at the expense of NAFTA laws. After all, what good is NAFTA if it isn't enforced?

Sean Ross

Here is PayPal's response to my letter which I received on January 13, 2011.

Dear Mr. Sean Ross,

My name is Demesha and I work for the office of Executive Escalations. I apologize for any confusion in regard to this matter and I can see how this situation could be frustrating.

I understand that you are requesting that PayPal allow Canadians to be able to accept payments for adult magazines and products.

As you are aware, on April 4, 2008, and December 19, 2010, you were advised that under the Acceptable Use Policy, PayPal may not be used to send or receive payments for certain sexually oriented materials or services or for items that are considered obscene, as PayPal allows U.S. only transactions for certain sexually oriented physical goods, such as videos, DVDs, magazines, or other products physically delivered to the customer. PayPal does not permit transactions for sexually oriented physical goods by users outside the U.S.

I apologize if you do not agree with our decision and we appreciate your feedback; however, please understand that using PayPal is completely voluntary and PayPal has a reasonable right to expect our customers to agree to the terms of our service before continuing to use our service. Just as you have a responsibility to abide by the terms and conditions set out in the User Agreement and Acceptable Use Policy, everyone else you do business with using PayPal will also have agreed to these terms and conditions. In fact, we would not be able to provide the type of service that we offer, if all of our customers did not agree to our terms. As always, you have the right to decline our terms. However, we as a company should not be expected to provide a service to a party who does not agree to our policies. The User Agreement and Acceptable Use Policy constitutes a contract between PayPal and yourself, and are designed to protect both you and the integrity of the PayPal service.

As such, please note that future violations in regard to this matter will result in your Account being permanently closed.

Again, please accept my apology. If you require further assistance please feel free to contact me directly at 402-952-8944 or via email at executiveoffice@paypal.com.

Executive Escalations

As can be seen by this response, these scofflaws deem themselves above the law. I invite any and all Canadians who have been affected by this arbitrary PayPal rule to e-mail me at paypalclassactionlawsuit@wonderclub.com. I will be starting a class action lawsuit against PayPal for these infractions and I will need at least 25 other Canadians to join me. If you have ever tried to sell an adult item on eBay but you couldn't sell the item because you could not accept PayPal then you are eligible to join this class action.

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