For the UID to be automated, you have to turn on the Unpaid Item Assistant. You can find it somewhere in your account settings.
As for what will happen after the bidder gets an unpaid item strike, well, paraphrasing Hans Blix in Team America, eBay will send him a letter explaining how very cross they are with him, and that is about it as far as anyone knows. At least when a bidder gets 2 strikes in a year's time, sellers can block them automatically.
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