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Staff Writer
22 December 2009
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 I bought a caravan on E-bay for £3,500 in early September but it never arrived. I raised the problem with Natwest - the provider of the credit card that I used to pay - but they told us we'd need to apply under section 75 under "item not as described". That was fine with us because the item was wrongly described anyway but in the end the seller agreed to settle the problem through PayPal and we were refunded the money on the 4th of November.
However, now Natwest won't close the case and are saying that the seller's bank must get until 15th February to dispute the case. I don't see how this can be the case as the merchant was Paypal and they have refunded and closed the dispute. As I see it, Natwest are trying to time me out and charge the £3,500 back to me on the 15th of February - what should I do? 
>Alex, London
First and foremost, you need to speak to NatWest and make them aware that you are clued up on the issue under discussion.
They may not be aware that there is an exception to the section 75 rule: paying through third parties, such as PayPal, is not covered.
There needs to be a direct relationship between the credit card provider and the supplier - so money needs to be transferred directly from one to the other. This does not happen with PayPal.
Therefore, section 75 does not apply between NatWest and the seller's bank, so NatWest are incorrect in saying that the seller's bank can dispute the case.
As PayPal have closed the matter, there is no further action required and Natwest will have no legal way to .
Section 75
Section 75 forms part of the Consumer Credit Act which was introduced in 1974. It gives you extra protection on purchases valued between £100 and £30,000 when paying by credit card.
When goods do not turn up, are damaged or have been described incorrectly, both the credit card company and the supplier are held equally responsible.
So, if the supplier goes bust and is unable to refund a customer for goods purchased via their credit card and not supplied, the customer can appeal to their credit card provider under section 75 and seek the refund from them.
Buying through Third Parties
However, there are a few exceptions to section 75 and the case in question here falls under one of these.
Buying through third parties means that the credit card provider and the seller are not in a direct relationship so are not equally liable.
This may be what has caused most of the confusion.
PayPal does have its own protection, details of which can be found on the PayPal website, but it is not as secure as the protection given under section 75 for purchases made directly with a credit card.
So, when PayPal is used for payment, there is no direct connection between the bank of the customer and the bank of the seller to qualify for consideration under section 75.
The overall solution, therefore, for a problem like this is to discuss it with your bank and if necessary, take it further through a financial ombudsmen.
PayPal are right and NatWest have got the facts wrong, I wish you the best of luck with this.
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