Betfair bids for Tasmanian licence - Tuesday 12th of April 2005
THE Tasmanian Government is close to granting a licence to the British betting exchange Betfair, giving the company a toehold in the Australian gambling industry that would break the monopoly of regulated TABs and on-course bookmakers.Premier Paul Lennon yesterday confirmed his Government was holding discussions with Betfair's Australian partner, Publishing and Broadcasting Ltd, and that he had met PBL executive chairman James Packer in Hobart last week.
Several Tasmanian racing industry players have softened their opposition to granting a licence allowing Betfair to operate legally in Australia, as long as the local industry is guaranteed the $25million-a-year revenue stream that it requires.
The Australian racing industry is threatening strong sanctions against Tasmanian racing if the state breaks ranks by granting Betfair a licence.
A Tasmanian licence would allow punters in other states to bet legally with Betfair by telephone or via the internet, a move Access Economics estimates could cost state governments between $30 million and $40 million a year.
It would also allow punters to back losers as well as winners, raising fears that it could allow corruption to flourish.
Australian Racing Board member Geoff Harper said Betfair was trying to use Tasmania as a "Trojan horse" to legalise its online betting exchange across Australia.
"It would mean a reduction in stakes, a reduction in prize money, a reduction in the (thoroughbred) breeding industry - the entire industry would suffer," Mr Harper said last night.
Racing Victoria chief executive Robert Nason warned that granting a licence to Betfair could see Tasmania's racing industries thrown out of mainland betting pools and Sky Channel's TV coverage.
"It would be devastating - who wants to invest in an industry that allows organised crime to flourish," Mr Nason said.
The Australian understands Tasmania is willing to flirt with Betfair because of a dispute with TABCorp over a $5.3million annual fee TABCorp charges TOTE Tasmania for being part of its pools.
TABCorp's "settlement fee" represents 17 per cent of TOTE Tasmania's operating costs and is an impost TOTE Tasmania and the local industry believe cannot be justified.
Industry sources last night said Betfair was seeking to capitalise on the row by selling its betting exchange as another source of revenue.
Betfair is known to be willing to spend up to $50million to become established in Australia and has promised to plough a proportion of profits back into the industry.
TOTE Tasmania chairman Michael Kent appeared relaxed
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