• Submitted by: manso
• Politics and Government
• 08 / 17 / 2011

---

Potentially putting a big U.S. Internet company in a tight spot, at least 10 German businesses selling Cuban products online are planning to sue PayPal Europe, after the Luxembourg-based subsidiary of eBay Corp. had suspended some accounts, German Website Amerika21.de reports.

In the 1990s, the European Union instituted a law that puts penalties on companies that apply U.S. embargo laws in Europe.

The suspensions became public when the owner of Munich-based DTS & W GmbH, which operates online wholesaler www.bardealer.de, complained that PayPal wouldn’t allow him to sell Cuban rum.

“In no way do we want to refrain from offering delicious Cuban rum to our clients,” the bardealer homepage says. “Therefore, we have (temporarily?) deactivated our PayPal payment service.”

According to Amerika21.de, in email messages PayPal — the dominating online payments provider — justified the suspension to DTS & W and other merchants with U.S. embargo laws against Cuba, saying that as a subsidiary of a U.S. company it is obligated to respect U.S. laws.

The online merchants, planning to sue before a provincial court in Munich, say PayPal’s action is threatening their existence; they will be seeking a temporary injunction forcing PayPal to reinstate suspended accounts. Attorney Andreas Eberl, representing the plaintiffs, told Amerika21 he didn’t believe PayPal’s extraterritorial application of U.S. laws would stand up within the European Union region.

According to Eberl, in their contract with clients PayPal Europe says British law applies. “U.S. law is nowhere to be found,” he said.

Source: http://www.cubastandard.com/2011/08/15/german-businesses-suing-paypal-ov...