WASHINGTON, August 15 — A proposed tie-up between PayPal and Stripe would draw immediate and intense scrutiny from antitrust enforcers on both sides of the Atlantic, as the combined market power of the two companies would trigger automatic reviews under US and EU law. The Hart-Scott-Rodino Antitrust Improvements Act of 1976 requires pre-merger notification for any transaction exceeding $111.4 million (as of 2024).
That filing would land on the desks of the Federal Trade Commission and the Department of Justice, agencies that have shown an increasingly aggressive appetite for blocking or reshaping tech sector consolidations. Under the FTC, led by Chair Lina Khan since 2021, the commission’s 2023 attempt to block Microsoft’s acquisition of Activision Blizzard—ultimately approved by a U.S. court—signaled a willingness to litigate to challenge deals it believes threaten competition.
Transatlantic spotlight
Across the Atlantic, the European Commission’s Directorate-General for Competition, led by Margrethe Vestager, would assess the same transaction under the EU Merger Regulation. The regulation kicks in when the combined worldwide turnover exceeds €5 billion and each of at least two of the undertakings concerned has EU-wide turnover above €250 million—conditions a PayPal-Stripe combination would meet. The Commission’s track record in fintech is clear.
In 2022, it gave conditional approval to the merger of Worldline and Ingenico only after the companies agreed to divestments to address competition concerns.
Core concerns
Regulators on both continents would zero in on the same set of issues. The combined entity could reduce competition in online payment processing, with the power to set terms for merchants and consumers alike. Data concentration is another red flag: the merger would pool two of the richest troves of transaction data in the sector, raising questions about market distortion and the potential for anti-competitive behaviour.
The FTC and DOJ would also weigh the impact on innovation. A dominant position in payments could stifle the next generation of fintech startups.
The EU, for its part, would apply its familiar test: whether the deal would significantly impede effective competition, particularly through the creation or strengthening of a dominant position.
What to watch
The first domino would be the HSR filing, which would start the clock on the US review. Expect the FTC to request a second, more intrusive look if its initial analysis suggests harm to competition. In Brussels, the Commission would open a Phase I investigation, with a Phase II probe likely if initial findings point to serious concerns.
Then comes the horse-trading. If history is a guide, the parties may offer divestments or behavioural remedies to secure approval.
But with Khan’s FTC and Vestager’s Directorate both signalling a tougher line, the odds of a smooth passage are slim. The deal, if pursued, would face a long, bruising battle—with no guarantee of survival.
