The rift between betting exchange Betfair and NSW racing authorities stretched across the globe on Thursday ahead of court action later this year.Betfair held a media briefing in Sydney to state its position on fees that should be paid to the racing industry while a holidaying Racing NSW chief executive Peter V'Landys hit back from China.Betfair chief executive Andrew Twaits says his company is prepared to pay a product fee of 20 per cent on gross revenue as opposed to the 1.5 per cent of turnov
The rift between betting exchange Betfair and NSW racing authorities stretched across the globe on Thursday ahead of court action later this year.
Betfair held a media briefing in Sydney to state its position on fees that should be paid to the racing industry while a holidaying Racing NSW chief executive Peter V'Landys hit back from China.
Betfair chief executive Andrew Twaits says his company is prepared to pay a product fee of 20 per cent on gross revenue as opposed to the 1.5 per cent of turnover as set down by the Race Fields legislation.
Betfair and corporate bookmaker Sportsbet have launched a legal challenge to that legislation which will be heard in November.
Twaits said Racing NSW could generate more than $10 million a year in extra product fees if all operators paid 20 per cent of gross revenue.
"We have offered to pay the industry on gross revenue that is, on the same basis as the TABs in NSW, QLD and Victoria. Further, we think 20 per cent is the right amount and we'll pay at that rate if everyone else does the same," Twaits said.
"Racing NSW has set the fees for TABs at just 9.375 per cent of their gross revenue. If Racing NSW sets its product fees at 20 per cent (of gross revenue) for all wagering operators, we believe they would be likely to generate more than $10 million per year in extra product fees for the industry."
However, V'Landys said the Betfair figures were incorrect.
"Betfair wants to pay 60 cents in every $100 wagered while the TAB pays $6.20 for every $100 bet," V'Landys said.
"The TAB pays a $12 million fixed product fee, 22 per cent on gross profit, 25 per cent on net profit and 1.5 per cent on turnover.
"That equates to $6.20 in every $100 bet.
"Betfair is holding the industry to ransom."
Betfair and the corporate bookmakers have been paying the 1.5 per cent turnover fee since the legislation was introduced in September last year but Racing NSW has not distributed that money to the industry in the event it loses the court case and has to pay it back.
The Race Fields legislation was introduced to try to stop leakage out of NSW, particularly to Northern Territory bookmakers.
Betfair, which is licensed in Tasmania, operates an online global service on both racing and sports.
Unlike bookmakers, it matches punters with each other and they in turn lay or bet on an event with Betfair taking a commission of between two and five per cent on winning bets.