PayPal Buyer and Seller Protection

This document sets out the terms and conditions of PayPal's Purchase Protection program, which may provide buyers with a refund covering the full purchase price plus original shipping costs when a purchased item is not received or is materially different from its description. PayPal reserves sole discretion to determine claim eligibility and may issue a temporary refund during investigation that can be reversed and recovered from the buyer's PayPal account balance if the dispute is not resolved in the buyer's favor, with at least five business days' advance notice before any deduction. The document also establishes that buyers must choose between filing a dispute with PayPal or pursuing a chargeback with their card issuer, as pursuing both simultaneously for the same transaction will result in PayPal closing its dispute process.

This document governs PayPal's Purchase Protection program, a buyer dispute resolution mechanism incorporated by reference into PayPal's user agreement, with an effective date of January 26, 2026. The terms authorize coverage of the full purchase price plus original shipping costs for eligible Item Not Received and Significantly Not as Described claims, while reserving to PayPal sole discretion to determine claim eligibility, make final decisions, issue temporary refunds that may subsequently be recovered from the claimant's account, and require item return at the buyer's expense. The document establishes a structured five-step online dispute resolution process with defined timeframes (disputes must be opened within 180 days of payment for Item Not Received claims, and within 30 days of delivery or 180 days of payment for Significantly Not as Described claims, whichever is sooner), a mandatory 20-day escalation window, and an explicit prohibition on pursuing concurrent disputes with both PayPal and a card issuer for the same transaction. The program engages consumer protection frameworks administered by the Consumer Financial Protection Bureau and the Federal Trade Commission, particularly regarding dispute resolution procedures for payment services, card chargeback rights under Regulation E and card network rules, and consumer disclosure obligations. Compliance teams should note the document's explicit acknowledgment that card issuer chargeback rights may be broader than PayPal Purchase Protection coverage, the clawback mechanism for temporary refunds, and the extensive list of ineligible item categories including NFTs, gift cards, crowdfunding payments, and items intended for resale.

The agreement establishes that PayPal holds sole discretion over whether a claim qualifies for Purchase Protection coverage, and that its original determination is considered final subject only to a limited appeal based on new information or identified decision-making error. Under these terms, temporary refunds issued during dispute investigation may be recovered from the buyer's PayPal account if the dispute is ultimately resolved against the buyer, with the document stating PayPal will provide at least five business days' advance notice before any such deduction. You can appeal PayPal's decision if you have new or compelling information not available at the time of the original determination, or if you believe there was an error in the decision-making process.