ASIC has commenced proceedings against PayPal Australia, alleging that its contract terms relating to errors in fees are unfair. ASIC said in its claim that PayPal’s standard form small business customer contract includes a term that gives business account holders 60 days to notify PayPal of any errors in fees that PayPal has charged them, or else accept those fees as accurate. The regulator said in a statement: “ASIC alleges the term is unfair because the effect is to permit PayPal to retain fees it has overcharged or wrongly charged if the small business does not notify PayPal of the error within 60 days of the fee appearing in its account statement. “We allege this term is unfair because it allows PayPal to escape the consequences of its own errors in overcharging small businesses and places additional burdens on small businesses to detect and correct charging errors.” It said the contract term causes a significant imbalance in the parties’ rights and obligations under the contract. Its claim said PayPal owes a duty to small business customers to keep accounts accurately and to render accurate account statements.  It also claims that a small business owes no obligation to PayPal to examine account statements or other account activity information to identify whether PayPal has overcharged and/or wrongly charged fees. ASIC is seeking a declaration that the term is void. It is also seeking injunctions and corrective orders. PayPal has been in the regulators’ sights this year. In March, AUSTRAC reported that the company would undertake remedial work on its reporting of international funds transfers, in response to concerns about the company’s systems, controls and governance in this area.  PayPal acknowledged AUSTRAC’s concerns and gave an enforceable undertaking to ensure compliance with AML/CTF law.