Jurisdiction(s):
United Kingdom

Related legal acts

Key definition

Penalty definition

What does Penalty mean? In contract practice, a penalty (or penalty clause) is a term that, on breach, requires the defaulting party to pay money or suffer another detriment aimed at deterring non‑performance rather than providing a proportionate, pre‑agreed remedy. Across England & Wales, Scotland and Northern Ireland, the penalty rule is case law (not statutory), developed in Dunlop and refined in Cavendish v Makdessi/ParkingEye. A clause is penal and unenforceable if it imposes a detriment out of all proportion to the innocent party’s legitimate interest in performance or enforcement. The assessment is one of substance, not label, and is not limited to payments: forfeiture...

UK CMA clears PayPal/iZettle merger (mPOS and omni-channel) after Phase 2; PayPal fined £250,000 for initial enforcement order breach during hold-separate

Published by a LexisNexis Competition expert

Practice notes

CASE HUB ARCHIVED

This archived hub sets out the position as at the date of the Penalty notice on 18 September 2019; it is no longer being updated. Please see also the timeline and commentary for further reference.

Case facts Outline

UK merger investigation into PayPal Holdings, Inc.’s completed purchase of iZettle AB. The deal features horizontal overlaps in the provision of mobile point-of-sale devices across the UK market nationally. The CMA also flagged possible issues in relation to ‘omni-channel’ payment solutions and services.

Latest developments

On 18 September 2019, the CMA served PayPal with a penalty notice for breaching the initial Enforcement order (IEO) set by the CMA at that time. A fine totalling £250,000 was levied. PayPal had requested, and obtained, a derogation from the IEO allowing it to undertake international integration steps, including running cross-selling pilot campaigns through its non-UK operations...

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Web page updated on 22/05/2026

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