Enterprise GLOBAL-365 has recently launched legal proceedings against PayPoint, accusing the payment services giant of engaging in anti-competitive conduct within the energy prepayment market.
PayPoint offers services to energy suppliers, allowing their prepayment meter customers to top up their credit through a network of 28,000 retail outlets across Britain.
Retailers receive commissions for transactions made via PayPoint terminals and PayPoint transfers these payments to energy suppliers in exchange for a transaction fee.
The legal action comes as GLOBAL-365 seeks to recover “significant losses and damages” resulting from its alleged exclusion from the market after launching its SMARTprepay system.
The dispute revolves around PayPoint’s alleged practice of entering into exclusive contracts with the Big Six energy suppliers, effectively shutting out other players, including GLOBAL-365, from the market.
Concerned about the alleged practices, GLOBAL-365 filed a complaint with Ofgem, the UK’s energy regulator.
In 2021, in response to an investigation into potential infringements of the Competition Act, the energy regulator decided to accept commitments from PayPoint and a £12.5 million donation to Ofgem’s Energy Industry Voluntary Redress Scheme.
A spokesperson for PayPoint told Energy Live News (ELN): “Further to our announcement made on 29th March 2023, PayPoint can confirm that on 18th July 2023, it was served with a claim by GLOBAL-365 plc and Global Prepaid Solutions Limited.
“PayPoint’s position on this matter is unchanged. It rejects the claim in its entirety, intends to vigorously defend its position and is confident it will succeed.
“The claim makes assertions relating to the voluntary commitments which were accepted by Ofgem on 23rd November 2021.
“It overestimates the opportunity, if any, available for the products offered by Global 365 and does not provide any clear evidence to support the cause of action or the amount claimed. Instead, it demonstrates a fundamental misunderstanding of the energy market and the relationships PayPoint held with energy suppliers.”
ELN has reached out to Ofgem and the Competition and Markets Authority for comment.
