Ofcom ends competition probe as PayPoint agrees to pay £12.5m

Energy regulator Ofgem said on Tuesday that it will put an end to an investigation into PayPoint after it agreed to pay £12.5m to address competition concerns.
Ofgem launched an investigation into the company in August 2017 to assess whether it had abused a dominant position by using exclusivity clauses in its contracts with energy suppliers and retailers in a way that was likely to restrict or distort competition for the provision of over-the-counter (OTC) energy prepayment services.

However, Ofgem has now accepted commitments from PayPoint, which has said it will remove these exclusivity provisions from current contracts and any future contracts and offer separate contracts to energy suppliers for the provision of OTC and non-OTC energy prepayment services.

This would mean that energy suppliers and retailers will be free to contract with other payment service providers and to use other providers’ equipment for processing OTC and non-OTC payments for their prepayment energy customers.

The company will also pay in £12.5m to Ofgem’s energy industry voluntary redress scheme.

“Ofgem believes that the commitments offered by PayPoint address its competition concerns and will ensure that competition is not distorted. Accepting these commitments means that the investigation closes with no decision made on whether competition rules were infringed,” the regulator said.

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