PayPal and other finance companies could be banned from blocking the accounts of campaign groups for political reasons under a new law being proposed by MPs.
Conservative backbenchers are considering launching an amendment to upcoming financial legislation in the House of Commons that would ban companies from freezing campaigners’ accounts.
It comes after UsForThem, which campaigned to keep schools open during the pandemic, and the Free Speech Union (FSU), a pressure group, had their PayPal accounts blocked and were accused of violating terms of service.
PayPal has since reinstated UsForThem’s account but the FSU’s three accounts with the US tech giant are still blocked and are not expected to be reviewed.
An amendment to the Online Safety Bill or Digital Markets Bill, which are both yet to be passed in Parliament, could be launched by Tory MPs.
One source said ministers are likely to accept the amendment to the law because Conservative backbenchers will support it.
It comes after officials from the Department of Culture, Media and Sport reached out to PayPal to demand an explanation for the accounts being blocked.
PayPal is not understood to have provided any official explanation to the Government beyond its public statement, which says the company “assesses activity against our long-standing Acceptable Use Policy and will discontinue our relationship with account holders who are found to violate our policies”.
Dozens of MPs sign letter calling for ban
Although the company does not comment publicly on individual accounts, the freeze is understood to have been imposed because of allegations of Covid misinformation, which both organisations deny.
Dozens of Tory MPs, including Michael Gove, David Davis and Sir Iain Duncan Smith signed an open letter to Jacob Rees-Mogg’s business department calling for a ban on the practice by financial services companies.
The MPs said it was “hard to avoid construing PayPal’s actions as an orchestrated, politically motivated move to silence critical or dissenting views on these topics within the UK”.
Asked about the issue in Parliament last week, Penny Mordaunt, the Leader of the Commons, said the firms were “still in the dark about exactly why they have had those services removed from them despite making great efforts to find out”.
She said the unexplained removal of service by tech companies was a “common theme amongst our casework” for MPs.
Toby Young, the FSU’s founder and general secretary, told The Telegraph: “The withdrawal of banking services from an individual or an organisation because they aren’t toeing the right political line is something you’d expect to happen in Communist China or North Korea, but not in a supposedly free country.”
The Department of Culture, Media and Sport was contacted for comment.