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RACEFIELDS LEGISLATION
29 Nov 2013NZTR  is  becoming  increasingly  concerned  about  the  growing  leakage  to  offshore  bookmakers

(Sportsbet, Sportingbet, Bet365, Centrebet, IASBet, Betstar, Betezy, et al), which take bets on New

Zealand racing and pay nothing to our industry, in the absence of race fields legislation here.     

In FY13 Racing New South Wales received $66.4 million in fees and associated interest as a result of

race  fields  legislation.  In  the  same  period,  Racing  Victoria  received  $78.1  million  and  Racing

Queensland received $30.5 million from having race fields legislation in place.

The New Zealand Racing Board estimates more than $200 million per annum is bet by New Zealand

residents on racing (and increasingly sport) through offshore bookmakers. These bookmakers have

become increasingly aggressive in their pursuit of domestic betting spend.   

Anecdotally, the  TAB  has  noticed the  departure  of  high‐staking  customers  and the sensitivity  of

activity by those customers to the odds set by the fixed odds book. I know, and I am sure you know, of

numerous anecdotal stories of industry participants betting with these free‐riding agencies.    

By paying no New Zealand tax or industry product fees, the bookmakers have a significantly unfair

cost advantage and, therefore, are able to offer better odds.    

So, what are the solutions?   

 Enacting race fields legislation  

This would give the NZ Racing Board the power on behalf of the racing/sporting codes to

approve any overseas agent in consultation with the codes. Such approval would require

payment of a fee to be set by the NZ Racing Board as a percentage of turnover and/or gross

betting profit.   

 Strengthening the advertising ban  

This would provide stronger enforcement of the existing advertising ban under the 2003

Gambling Act, which is being increasingly circumvented by digital media.   

 Deterrent penalties

Race fields legislation should impose penalties which include extradition. This is the model

followed by Australia and most other countries. This would ensure compliance by corporate

bookmakers.   

 

 Point‐of‐consumption legislation  

This is an alternative approach. It defines the location of the placing of a bet by where the

bettor resides, rather than where the agency’s computer server or the betting agency is located.

This  would  ensure the  bet  has  domestic New  Zealand taxes  and  product fees  levied  on  it

regardless of where an overseas bookmaker has placed its server. This legislation has passed its

first reading in the United Kingdom Parliament.

 

You might ask why we don't assert copyright of our race fields. This option would cost many millions

of dollars because we would have to fight each bookmaker separately on a slight variant of how they

are  using  our  race  fields  information.  Australian  authorities  looked  at  this  exact  question  and

concluded legislation was needed.

 

Your MP should be aware of:

 

 A loss of jobs and economic activity throughout New Zealand  

This leakage to overseas bookmakers directly  causes a decline of racing and sporting  codes'

income, resulting in lower prizemoney and a lesser number of events being held. The racing

industry directly generates more than 16,000 full‐time jobs, many in regions with few other

opportunities, so  the  negative  impact  isn’t  a  pin‐prick  at  the  margins  but  one  that really

matters.

 

 Threats to Racing Integrity

It is impossible to monitor whether participants with direct control over the outcomes of events

are betting through these agencies. Imagine the furore if an All Black was found to be betting

through an overseas bookmaker.

 

 Problem gambling  

Overseas bookmakers offer credit betting into New Zealand and typically attract larger bettors,

who, by their nature, are more likely to have problem gambling issues. These bookmakers pay

no problem gambling levy and do not provide appropriate harm reduction measures.

 

 Lost tax revenue via GST and Wagering Duty

This is very significant in the context of $47 million in GST and wagering duty paid directly by the

NZ  Racing  Board  and  the  many  multiples  of  this  in  GST  and  income  tax  generated  by

downstream racing activity.  

 

 International precedent

Most other major racing jurisdictions have effective legislation in place to combat this leakage.

New Zealand does not. The upturn in Australian prizemoney and general industry health has

been significant since their successful  defence  of race fields  legislation. New  Zealand must

follow.