TABCORP WANTS ONLINE BETTING EXCHANGES BANNED

30 November 2007

Australian competitive kitchen is getting hotter


Australia's Tabcorp is clearly worried about the competitive threat posed by Betfair's successful entry to the Australian market, judging by a letter this week from Tabcorp boss Elmer Funke-Kupper. In the letter, the gambling executive calls on Australia’s New South Wales and Victoria territories to ban betting exchanges through "urgent and decisive action" to address "this erosion of the Victorian wagering market."

Funke-Kupper took aim at Northern Territory bookmakers and James Packer's jointly owned Betfair, recommending that the state government "legislate a ban on betting exchanges".

The Victorian Government is currently looking at the structure of its wagering industry and the NSW premier is also holding a review of that state's wagering market. The wagering review will decide whether betting exchanges such as Betfair are granted a licence in the state.

There is speculation former Australian Securities and Investment Commission chairman Alan Cameron could head up the review.

Meanwhile, Betfair has launched a High Court challenge against the Western Australian state government, which recently blocked it from operating in the state. According to Australian media reports, South Australia is the only other state supporting WA's ban on integrity grounds. Reports emanating from a national racing minister's conference earlier this month are that WA was unable to gather support for a motion to condemn betting exchanges.

The NSW wagering review is expected to be completed by February, but the outcome may be delayed until after the High Court judgment, due around April.

Funke-Kupper wants to see the introduction of basic reforms that he says will "put competition over the internet and phone on a level playing field". Tabcorp proposed the introduction of a fee of 1.5 percent to 2 percent of turnover on all corporate bookmakers and betting exchanges that publish Victorian race fields.

"This change should be the same, irrespective of the operator's betting model," Funke-Kupper asserted.

A Tabcorp spokesman said: "Tabcorp is aware the racing industry and governments are concerned about integrity risks surrounding betting exchanges."

Tabcorp shared those concerns, he said. "Given the size of the racing industry, this is a risk it cannot afford to take."

The NT corporate bookmakers were "not paying their way and the industry, governments, Tabcorp and licensed bookmakers are disadvantaged", he said.

Tabcorp estimates NT corporate bookmakers' wagering turnover has jumped from $193 million in 2001 to $2.7 billion in 2006.

Leakage from the wagering market was costing the NSW government $26 million and Victoria $16 million, Tabcorp said.

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