23 August 2014

PayPal closes UK coffee seller's account over commie Cuban beans

19 April 2013  |  7156 views  |  2 coffee beans

An independent coffee shop in the Yorkshire village of Nether Poppleton recently had its PayPal account shut down after incurring the wrath of the e-commerce giant by stocking beans from communist Cuba.

According to the Independent, family-run York Coffee Emporium - which sells beans online - had its PayPal account closed without warning, meaning money could not be moved in or out.

The firm's owners, Laurence and Philippa Beardmore, were told that the action had been taken because they sell a brand of coffee called Cuban Serrano Superio.

The US, where PayPal is based, has had a strict trade embargo in place on Cuba since 1960, two years after Fidel Castro seized control of the island state.

Despite the fact that the UK has no such embargo in place, a PayPal spokesman told the Independent: "We have determined that as a US company, PayPal and all of its subsidiaries are obliged to comply with specific US government-imposed sanctions, even if these subsidiaries operate outside of the US."

The Beardmores' account has been reinstated but any customers wishing to buy Cuban Serrano Superio have to use the alternative Sage Pay system.

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Comments: (2)

A Finextra member | 22 April, 2013, 09:35

Is this an issue on me excercising my right to buy cuban coffee inspite that Cuba restricts its population the freedom of speach and most other basic human rights - or on payment systems supposed to be be neutral to any kind of business conducted? Must payment systems follow the legislation -yes. Can payment systems have values on top of legislative demands restricting my usage of the payment system? I guess most payment systems have such values... What is the news here?

Michael Fuller - None - London | 22 April, 2013, 15:47

I think we need to remember that the embargo against Cuba is a unilateral one by the United States against a sovereign state and member of the UN. The fact that legitimate trade between parties in the UK is frustrated by this is a warning of the potential dangers of using payment systems which are global rather than local. The increasing use of globalised and cloud based payment systems mean that transactions do not take place locally but are routed through different countries and are subject to laws of third party states.

Financial Services organisations should consider the risks of relying on globalised payment systems but as the balance of trade shifts it is to be hoped that we will see the emergence of regional and super regional payment systems which are able to offer an alternative.

The ability to route transactions to avoid blockages in the way that the internet does should be given greater priority when constructing systems.

I for one was pleased to buy some Cuban coffee when I heard about this.

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