The Justice Department is said to be keen to look at whether or not eBay could use PayPal as some kind of leverage against other auction sites. The authorities would have to prove that eBay wants to make it harder to use PayPal’s services on other auction sites or make it easier to use PayPal services on eBay rather than other sites. The Department of Justice will also want to look closely at whether combining PayPal with its rival product Payments by Billpoint would eliminate competition. PayPal is the market leader in the online payment market. One of its biggest rivals in that market is Payments by Billpoint, which is owned by eBay.
The acquisition of PayPal was not expected to close until late Q4. Many analysts believe that this shows that eBay and PayPal were expecting some kind of antitrust investigation, as the two companies have anticipated the need to leave at least a three month period in which to answer any government department’s questions.
