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Thursday, January 22, 2004


A total of 122 entries are unveiled today for the 2004 Martell Cognac Grand National, worth £600,000 and run at Aintree on Saturday, April 3, with one of the highest-class fields ever set to line up for the world’s most famous chase this year.

Two previous Martell Cognac Grand National winners, last year’s scorer Monty’s Pass and the 2002 victor Bindaree, are engaged again with the entries including six of last year’s first eight finishers.

Those entered include the French-trained First Gold, runaway winner of last season’s Martell Cognac Cup at Aintree, last season’s AON Chase victor Valley Henry, 2003 Tote Cheltenham Gold Cup third Harbour Pilot, Tripleprint Gold Cup winner Fondmort, Peter Marsh Chase scorer Artic Jack, the 2002 Martell Cognac Grand second What’s Up Boys, as well as Swansea Bay, whose four wins this season include the Edward Hanmer Chase at Haydock.

Rince Ri, an eyecatching second at Fairyhouse on Sunday, and the 2002 Tote Cheltenham Gold Cup second Commanche Court, are part of a 30-strong entry from Ireland and their trainer Ted Walsh - successful in the 2000 Martell Cognac Grand National with Papillon - is hoping to run both horses at Liverpool.

“I definitely hope that Commanche Court and Rince Ri run at Aintree in the Martell Cognac Grand National,” said Walsh. “I just hope that the handicapper is kind to them and am of course looking forward to the race. One of them will come over to England this weekend (for the Pillar Property Chase at Cheltenham) - probably Rince Ri.”

Ireland’s challenge also includes the progressive What Odds, who races in the same ownership as Monty’s Pass, Willie Mullins’ seven entries include the novice Rule Supreme, Trevor Hemmings’ Coral Welsh National third Hedgehunter, who runs in today’s Thyestes Chase, while Davids Lad and Timbera, winners of the Irish National in 2001 and 2003, add further weight to the challenge from across the Irish Sea.

Clan Royal, one of nine entries for owner J P McManus and a winner at Aintree on his last two starts and the Ginger McCain-trained Amberleigh House, who finished third last year, came first and second in this season’s thrilling Tote Becher Chase over the National fences at Aintree. The 2003 fourth Gunner Welburn is another with strong claims while an intriguing entry is Royal Altalza, a half-brother to Royal Rosa with winning form in France now owned by the flamboyant Terry Ramsden, one of the best-known racehorse owners in the 1980s, whose Mr Snugfit finished fourth in 1986.

Charles Barnett, Aintree’s Managing Director, commented: “We are delighted with the entry and in particular the quality. It is clear from the 30 Irish entries that after three victories in the last five years, they are keen to capture the prize again.

“Looking through the entries it is already clear that there are many great stories that could unfold, as always seems to be the case with the Martell Cognac Grand National.”


Class A, Showcase Handicap, Total Prize Fund £600,000, Aintree, Saturday, April 3, 2004. Four Miles & Four Furlongs (Over the Grand National Course). For six-year-olds and upwards which are allotted a rating of 110 or more by the Senior BHB NH Handicapper following a review of the horses entered and after taking account of races run up to and including February 1. Horses which are not qualified for a rating in Great Britain or Ireland at January 21 may also be entered. Such horses may be eligible for a weight providing the Handicapper is satisfied that the horse’s racecourse performances to February 1 would merit a minimum rating of 110, and that the horse has either won a Steeple Chase or Hurdle Race, or has run at least three times collectively in Steeple Chases or Hurdle Races run under the Rules of Racing of the same Recognised Turf Authority by February 1. At the Handicapper’s discretion, such horses may be allotted a rating. The decision of the Senior BHB NH Handicapper shall be final. Entries closed Wednesday, January 21, 2004 (122 entries), entries revealed Thursday, January 22, 2004. Weights revealed Tuesday, February 3, 2004. First confirmation stage Tuesday, February 17, 2004; second confirmation stage Tuesday, March 23, 2004. Five-day confirmation stage Monday, March 29, 2004. Final declaration stage 10am, Thursday, April 1, 2004. Confirmation of riders must be made by 1.00pm Thursday, April 1, 2004. Form figures supplied by Weatherbys and are correct up to and including the racing of Wednesday, January 21, 2004. May not include some overseas form.

Form Horse Age Owner Trainer
1U11-54 A PIECE OF CAKE (IRE) 11 Lightbody Celebration Cakes Ltd Mary Reveley
3U1-66F AD HOC (IRE) 10 Sir Robert Ogden Paul Nicholls
6P02-FP AKARUS (FR) 9 A J White Martin Pipe
4-2555P ALCAPONE (IRE) 10 Ann Daly Mouse Morris IRE
16U3/-66 ALEXANDER BANQUET (IRE) 11 Miriam O'Callaghan Willie Mullins IRE
033-342 AMBERLEIGH HOUSE (IRE) 12 Halewood International Ltd Ginger McCain
242200 ARCTIC COPPER (IRE) 10 Grand Alliance Racing Club Noel Meade IRE
120-434 ARDENT SCOUT 12 Alicia Skene & W S Skene Sue Smith
PU3/-131 ARTIC JACK (FR) 8 Trevor Hemmings Sue Smith
11563/-4 ASSESSED (IRE) 10 Festival Syndicate Willie Mullins IRE
253-343 BALLYAMBER (IRE) 9 Sean Mulryan Willie Mullins IRE
UP4P-21 BALLYBOUGH RASHER (IRE) 9 Comtake-Welding Engineering Specialists Howard Johnson
211-1PP BALLYBROPHY (IRE) 9 Keith Berry Simon Sherwood
3000-11 BE MY MANAGER (IRE) 9 Brian Murfin Martin Todhunter
12-P111 BEAR ON BOARD (IRE) 9 J E Brown Alan King
06-F216 BINDAREE (IRE) 10 Raymond Mould Nigel Twiston-Davies
6000-40 BLOWING WIND (FR) 11 Peter Deal Martin Pipe
1/0P6-3P BOUNCE BACK (USA) 8 Belinda Harvey Martin Pipe
0F-P6P3 BRAMBLEHILL DUKE (IRE) 12 Mel Davies Venetia Williams
12-6100 BROWNIE RETURNS (IRE) 11 Ann Daly Mouse Morris IRE
236P/34- CELIBATE (IRE) 13 Stamford Bridge Partnership Charlie Mann
220P-4P CHIVES (IRE) 9 Trevor Hemmings Henrietta Knight
51411-1 CLAN ROYAL (FR) 9 J P McManus Jonjo O'Neill
3163-56 COMMANCHE COURT (IRE) 11 Dermot Desmond Ted Walsh IRE
6//F41-00 COQ HARDI DIAMOND (IRE) 10 Catherine Howard Noel Meade IRE
600032/- DARK STRANGER (FR) 13 Terry Neill Martin Pipe
404-356 DAVIDS LAD (IRE) 10 Eddie Joe's Racing Syndicate Tony Martin IRE
22564-1 DESAILLY 10 The Team Toby Balding
0403-26 EXIT SWINGER (FR) 9 Sandicroft Stud I Paul Nicholls
PUP-353 EXIT TO WAVE (FR) 8 Malcolm Pearce & Gerry Mizel II Paul Nicholls
5250U6- FADALKO (FR) 11 Sir Robert Ogden Martin Todhunter
35-1222 FASGO (IRE) 9 F A Smith Paul Nicholls
3P1-153 FIRST GOLD (FR) 11 J P McManus Francois Doumen FR
F022-14 FONDMORT (FR) 8 Bill Brown Nicky Henderson
4/2///15-1 GLADTOKNOWYOU (IRE) 11 W Packham Richard Rowe
10/2F3-3 GOLA CHER (IRE) 10 Fred & Sue Welch Alan King
43D0P-P GOOD SHUIL (IRE) 9 R Newsholme D Gorton F Wilson & B Walsh Charlie Mann
2P1/P-UP GRANIT D'ESTRUVAL (FR) 10 Walter Gott Ferdy Murphy
014-P1P GUNNER WELBURN 12 William Ritson/David Hall Andrew Balding
2/3333-0 HARBOUR PILOT (IRE) 9 Kays Syndicate Noel Meade IRE
310-243 HEDGEHUNTER (IRE) 8 Trevor Hemmings Willie Mullins IRE
1113P-3 HERMES III (FR) 9 Lord Daresbury Mick Easterby
0P-0022 IMPERIAL DE THAIX (FR) 8 Jeff Lammiman Martin Pipe
P46-411 INDIAN CHANCE 10 Chris and Stella Watson and Jock Cullen Dr Jeremy Naylor
04344P- INNOX (FR) 8 Marquesa de Moratalla Francois Doumen FR
P2-111P IRIS ROYAL (FR) 8 Sir Robert Ogden Nicky Henderson
U05-00P IZNOGOUD (FR) 8 County Stores-Avalon Surfacing Martin Pipe
24/42/-21 JANUS DU COCHET (FR) 7 Terry Neill Martin Pipe
41F/31-1 JOE BLAKE (IRE) 9 Ronnie Bartlett Len Lungo
5/1110-2 JOSS NAYLOR (IRE) 9 Darren Mercer Jonjo O'Neill
13-1452 JURANCON II (FR) 7 David Johnson Martin Pipe
312203 JUST IN DEBT (IRE) 8 J W Hazeldean Martin Todhunter
15-3651 KELAMI (FR) 6 Haras d'Ecouves Francois Doumen FR
22P-P2R KILDORRAGH (IRE) 10 Carrie Zetter-Wells Lawrence Wells
FP-61PF KILLULTAGH THUNDER (IRE) 8 Rose Boyd Willie Mullins IRE
3//113/1/- KING ON THE RUN (IRE) 11 Lady Harris Venetia Williams
1141-1F KINGS MISTRAL (IRE) 11 R V Shaw Patrick Chamings
24/13-36 KINGSMARK (IRE) 11 Sir Robert Ogden Martin Todhunter
11F4-42 LE COUDRAY (FR) 10 J P McManus Christy Roche IRE
11-1 LORD ATTERBURY (IRE) 8 David Johnson David Pipe
21130-U LORD JACK (IRE) 8 Trevor Hemmings Nicky Richards
00/1-0F5 LUZCADOU (FR) 11 A G Chappell Ferdy Murphy
5/1P32-P MACS GILDORAN 10 Margaret McManus Willie Mullins IRE
P-F1111 MAGICAL BAILIWICK (IRE) 8 Islands Racing Connection Martin Pipe
43P2/-PP MAN ON THE HILL (IRE) 10 David Johnson Ferdy Murphy
312/2U6- MANTLES PRINCE 10 Emlyn Hughes' Cleobury Golfers Alan Juckes
04F-42P MAXIMIZE (IRE) 10 David Johnson Martin Pipe
411PP-0 MINI SENSATION (IRE) 11 J P McManus Jonjo O'Neill
P25P-35 MONTIFAULT (FR) 9 Anne Fulton Paul Nicholls
U3-F64S MONTREAL (FR) 7 David Johnson Martin Pipe
3641-50 MONTY'S PASS (IRE) 11 Dee Racing Syndicate Jimmy Mangan IRE
1U0-243 MOOR LANE 12 Bob Michaelson Andrew Balding
1P-PPF0 MORE THAN A STROLL (IRE) 12 Mrs D Grehan Arthur Moore IRE
12144-1 MR BOSSMAN (IRE) 11 T N Siviter Richard Guest
211D20 NATIVE PERFORMANCE (IRE) 9 Donal O'Connor Michael Hourigan IRE
4341-PP NATIVE SESSIONS (IRE) 9 R D Murphy Noel Meade IRE
212320 NOSAM 14 Norman Mason Richard Guest
11- ONLY ONCE 9 Ashleybank Investments Limited Len Lungo
1P1232 PALADIN (FR) 9 Naji Pharaon Jacques Ortet FR
P-12114 PUNTAL (FR) 8 Terry Neill Martin Pipe
P/5022U- RED STRIKER 10 Norman Mason Richard Guest
11-23F2 RINCE RI (IRE) 11 Frank Moriarty Ted Walsh IRE
3-161F2 RISK ACCESSOR (IRE) 9 J P McManus Christy Roche IRE
06-0601 ROYAL ATALZA (FR) 7 Terry Ramsden Conrad Allen
440-4F0 ROYAL AUCLAIR (FR) 7 Clive Smith Paul Nicholls
10P-0P5 ROYAL PREDICA (FR) 10 Peter Deal, J S Dale & Alan Stennett Martin Pipe
45-1U13 RULE SUPREME (IRE) 8 John Lynch Willie Mullins IRE
342-421 SCOTMAIL BOY (IRE) 11 George Tobitt Howard Johnson
2133F-1 SCOTS GREY 9 Henry Ponsonby Nicky Henderson
100/1-14 SECRET NATIVE (IRE) 9 Mary Ward Tom Taaffe IRE
12/F132- SHAMAWAN (IRE) 9 J P McManus Jonjo O'Neill
12-U11P SHARDAM (IRE) 7 Howard Parker Nigel Twiston-Davies
111P/5P- SHOOTING LIGHT (IRE) 11 John Brown & Michael Blackburn Martin Pipe
1205-0P SILVER STEEL 9 J P McManus Christy Roche IRE
1P2/P-U5 SILVER STREAK (IRE) 10 Mrs Timothy Pilkington Nick Gifford
33/P403/- SIMPLY GIFTED 9 Steve Hammond Jonjo O'Neill
11-30U0 SKYCAB (IRE) 12 P H Betts (Holdings) Ltd Nick Gifford
35PP/05- SMARTY (IRE) 11 Tracy Brown Mark Pitman
000-431 SOUTHERN STAR (IRE) 9 Trevor Hemmings Henrietta Knight
U0-U042 SPOT THEDIFFERENCE (IRE) 11 J P McManus Enda Bolger IRE
013-412 STAR CLIPPER 7 Des Sharkey Noel Meade IRE
1/5//P-P0U STORMYFAIRWEATHER (IRE) 12 Bridget Hanbury Nicky Henderson
P-11110 SWANSEA BAY 8 Peter Bowling Peter Bowen
230-435 TAKAGI (IRE) 9 Dermot Cox Edward O'Grady IRE
121B14 TAKE THE STAND (IRE) 8 The Courters Peter Bowen
P00U0-0 THE BUNNY BOILER (IRE) 10 The Usual Suspects Syndicate Noel Meade IRE
/313//11/- THE BUSHKEEPER (IRE) 10 Brian Stewart-Brown Nicky Henderson
P241-55 TIMBERA (IRE) 10 Mrs J M Breen Dessie Hughes IRE
600-P32 TOM COSTALOT (IRE) 9 Gerard Nock Susan Nock
221133///- TOTO TOSCATO (FR) 10 Lady Clarke Martin Pipe
10/-22P2 TYNEANDTHYNEAGAIN 9 Norman Mason Richard Guest
144-F3F VALLEY HENRY (IRE) 9 Andrea & Graham Wylie Howard Johnson
F5P-P06 VANILLA MAN (IRE) 11 Mrs P Duffin Paddy Mullins IRE
244320 WAHIBA SANDS 11 David Johnson Martin Pipe
22/24-32 WAIN MOUNTAIN 8 Bill Smith and Mick Dudley Jim Old
P1-113 WHAT ODDS (IRE) 8 Dee Racing Syndicate Tucker Geraghty IRE
14P52/F- WHAT'S UP BOYS (IRE) 10 Mrs J F Deithrick Philip Hobbs
0-11341 WHEREAREYOUNOW (IRE) 7 Raymond Mould Nigel Twiston-Davies
PF-P105 WINDROSS 12 Mrs Peter Prowting Alan King
4F-5FPP WONDER WEASEL (IRE) 11 Alan Halsall Kim Bailey
110-121 WORLD WIDE WEB (IRE) 8 J P McManus Jonjo O'Neill
1P20U-3 YOU'RE AGOODUN 12 Jeff Lammiman Martin Pipe

122 entries
30 Irish-trained
4 French-trained


17 Entries
Martin Pipe (1994 Miinnehoma)

7 Entries
Willie Mullins IRE

6 Entries
Noel Meade IRE
Paul Nicholls
Jonjo O’Neill

5 Entries
Nicky Henderson

4 Entries
Richard Guest
Martin Todhunter

3 Entries
Francois Doumen FR
Howard Johnson
Alan King
Ferdy Murphy
Christy Roche IRE
Nigel Twiston-Davies (1998 Earth Summit, 2002 Bindaree)

2 Entries
Andrew Balding
Peter Bowen
Nick Gifford
Henrietta Knight
Len Lungo
Charlie Mann
Mouse Morris IRE
Sue Smith
Ted Walsh IRE (2000 Papillon)
Venetia Williams

1 Entry
Conrad Allen
Kim Bailey (1990 Mr Frisk)
Toby Balding (1969 Highland Wedding, 1989 Little Polvier)
Enda Bolger IRE
Patrick Chamings
Mick Easterby
Tucker Geraghty IRE
Philip Hobbs
Michael Hourigan IRE
Dessie Hughes IRE
Alan Juckes
Jimmy Mangan (2003 Monty’s Pass)
Ginger McCain (1973, 1974, 1977 Red Rum)
Tony Martin IRE
Arthur Moore IRE
Paddy Mullins IRE
Dr Jeremy Naylor
Susan Nock
Edward O’Grady IRE
Jim Old
Jacques Ortet FR
David Pipe
Mark Pitman
Mary Reveley
Nicky Richards
Richard Rowe
Simon Sherwood
Tom Taaffe IRE
Lawrence Wells


Betfair will appear before the parliamentary Joint Committee looking at the Draft Gambling Bill today

The Government published its draft Gambling Bill on 19th November 2003. This is Betfair’s
submission to the Joint Scrutiny Committee in response to the detail of the Bill.


1. Betfair wholly supports the licensing objectives set out in Clause 1 of the Bill.

2. Betfair has consistently maintained that the Bill’s three objectives are best achieved at source, and as a result it welcomes the conclusion that those providing betting facilities to consumers, and not the consumers themselves, need to be properly regulated. Betfair notes that a key policy aim is “not to curb the industry’s innovation but rather to ensure that proportionate regulatory action is taken to protect the licensing objectives”. We believe that the above conclusion fulfils these aims.

3. Betfair has voluntarily introduced measures which are constantly setting new standards in furthering the licensing objectives such as: ring-fencing client accounts and demanding that every bet be fully-collateralised to exclude the risk of default; maintaining unprecedented audit trails of transactions taking place on its site; and sharing information with the appropriate authorities to minimise the risk of criminal abuse. Betfair hopes many of these measures will become obligatory throughout the industry, as is suggested in the Policy document paragraph 4.25.

Who needs regulating?

4. The Draft Bill lays out specifically who will require regulation under the new law. The fundamental principle is set out in Clause 21 which makes it an offence for a person toprovide facilities for gambling unless he holds the appropriate operating licence. There are no provisions requiring licensing of individuals who are merely betting and not providing facilities for gambling to others.

5. Many of Betfair’s competitors have argued that Betfair’s customers need regulating, on the grounds that they can “lay” bets. Betfair has made submissions before as to why the licensing of those who bet on outcomes not to happen (that is, ‘layers’ as the term is used on Betfair) runs contrary to the objectives of government. It would be wholly unnecessary and unbalanced over-regulation, penalising a punter for placing a bet on a betting exchange when he could just as well place the same bet with a traditional bookmaker without penalty. It would achieve nothing that is not achieved by licensing the operator. Indeed, it may even jeopardise the primary objectives of government.

6. The Joint Scrutiny Committee will already be aware of the fact that every fixed odds bet merely involves one person agreeing to stake £X to win £Y on one of two mutually-exclusive outcomes occurring, and another person agreeing to stake £Y to win £X on the other mutually exclusive outcome occurring. Every “lay” bet on Betfair is just a bet that something will not happen and can be turned into a “back” bet by changing the outcome on the Betfair betting slip to its mutually exclusive alternative.

7. Traditional bookmakers argue that there is something inherent in “laying” that is the preserve of the bookmaking community. In the Betfair sense of “laying”, there is not. It is important to recognise that “laying” by traditional bookmakers is not the same as “laying” on Betfair. If Ladbrokes offer two bets in their shops, Bet A on “England to win” and Bet B on “England not to win in their shops”, then Ladbrokes are “laying” (as they themselves define it) both outcomes. But if they entered the same bets on Betfair, then in Betfair terms they would be “laying England to win” and/or “backing England not to win” in Bet A and they would be “laying England not to win” and/or “backing England to win” in Bet B depending on how Betfair decided to set up its screens and betting slips.

8. It is not by virtue of being able to bet on an outcome not to happen or to request better odds that the need for a bookmaker’s permit is generated (either in principle or under the letter of the law). It just happens that in the 20th Century bookmakers did not generally allow punters to bet on outcomes not to happen nor generally accept requests for better odds (but there were certainly many exceptions to both these practices).

9. It is purely by convention that this has been the case. You can bet that something does not happen without needing to deal with the public and accept a stake, in just the same way as you can bet that something will happen without doing either of those things. It is the person who is providing the facilities for gambling to the public, handling punters’ stakes, ensuring winning punters get paid out and in a position to vet out minors and problem gamblers who needs to be regulated, just as it is the car driver who needs the licence, and not the person travelling in the same car to the same place. Regulation is only required where there is a risk of harm. This is why Clauses 4 and 21 of the Gambling Bill focus on the person providing facilities for gambling and not the gambling consumers themselves.

Opposing an outcome

10. Many who accept the argument above continue to see a risk in the ability of the public to bet against something happening in the context of a horserace. That is, the ability to bet that a horse will not win has been marked out as a means for corruption to find its way into sport, and therefore one of the three pillars of regulation – keeping crime out – is said to be undermined.

11. Betfair has already submitted to the Scrutiny Committee a separate paper on integrity
(attached as an appendix), but in addition to that paper, it is worth making a few points.

12. First, the ability to oppose a horse has always been possible with traditional bookmakers by betting on the other horses running. It has also as always been possible by “selling” a horse with a spread betting operator. And increasingly, it is also available with bookmakers – aside from much-quoted anecdotal evidence demonstrating that it has always been possible, in any case, on course. For example, betattheraces recently offered 7/4 the favourite, and 2/5 the field against the favourite (or, to put it into traditional terminology, back the favourite at 7/4, lay it at 2/5). This is already very common in other sports. It is common to see odds offered by traditional bookmakers on the field against Tiger Woods or Schumacher, or against a particular team or country winning an event. Indeed, in a recent England football match, many were even offering prices on ‘Rio Ferdinand not to start’ (i.e. not to be named in the starting line-up).

13. Second, it is not by demanding that every person who ever bets on a horse not to win or a team not to win first presents himself at the Magistrates Courts to obtain a bookmaking licence that crime can be kept out of sport. That would be hopelessly misdirected, ineffectual and superfluous regulation. Instead, betting on sport should be transparent and operators should be obliged to monitor and report suspicious activity. Betfair does both of these to a greater extent than any other operator:

• Betfair maintains an unprecedented audit trail of bets placed on its site and those behind them. It willingly shares this information with sports regulators on an anonymous basis and, subject to signing a Memorandum of Understanding (as it has, for example, with the UK Jockey Club and the ATP tour), will provide details of individuals involved where there is a strong suspicion of skulduggery.

• Transactions at every increment are visible to anyone who looks at the Betfair site, with volumes also visible. Betfair, in addition, sees each increment broken down into its individual components. That is, a visitor to Betfair’s site can see the aggregated bets, and Betfair sees every single one. This is a level of transparency unparalleled among other operators.

14. It should be noted that Betfair has no interest in the outcome of the event, because every bet for Betfair is a winning one (as the operator is paid by the winning punter). Betfair’s business depends on the integrity, and perceived integrity, of its platform. Its business interests are entirely in line with those of the regulators. Betfair’s Memorandum of Understanding with the Jockey Club was ground-breaking. This contrasts with traditional bookmakers who, as the BBC’s 2002 Panorama programme demonstrated with references to William Hill’s refusal to help the Jockey Club in their investigations into the Man Mood affair, depend on their networks of insiders and will refuse to expose them even where there is overwhelming evidence of skulduggery. Why is it that traditional bookmakers have still not signed the MOU? Indeed after 40 years, why is it only when Betfair initiates the MOU that they even begin to consider signing an MOU themselves?

15. Third, there have been suggestions that Betfair needs to be regulated along the lines of the FSA. It is Betfair’s understanding that the Gambling Commission will fulfil precisely that sort of role. As stated above, Betfair welcomes regulation by the Gambling Commission, because Betfair has introduced as voluntary best-practice precisely the sort of safeguards which regulation will make compulsory. Its recently-announced FSA-style exams for its staff, in conjunction with GamCare, are a clear example of Betfair’s wish to bring safeguards already inherent in the financial markets to the gambling industry.

16. It should be noted once again though, that the FSA regulates the provider of financial services, and not the customer. There is no restriction on an individual buying and selling shares. The service provider is regulated because it is the service provider, not the day trader, which poses the risk to the public and the regulatory objectives in the financial services industry. Similarly it is the provider of betting services and not the gambler which poses the risk to the public and the licensing objectives in the gambling industry. It is the operator which needs to be accountable and provide transparency to the regulator. Betfair already provides this as standard, but again, it welcomes the fact that all operators will have to do so as a matter of law rather than voluntarily.

17. The government is aware of concerns that, unless properly run, betting exchanges may constitute a threat to the integrity of sport, and in its Policy it has indicated that it will take whatever measures are appropriate and proportionate to protect consumers’ interests and the integrity of all sports. As stated above, we support this. Again, the regulation of the exchange is of paramount importance in order to ensure that new standards being set and adhered to already by the biggest player become obligations for all new entrants. Cheating in sport and sports betting has, sadly, always existed. The Betfair model enables the very small proportion of cheats to be tracked and prosecuted, but only with the co-operation of the operator. All operators must be obliged to co-operate if sport is to be kept free of corruption.

Betting Intermediaries and the code of practice

18. Clause 51(2) creates a new category of operating licence permitting a person “to act as a betting intermediary” where a betting intermediary is defined as “person who provides a service designed to facilitate the making or acceptance of bets between others”.

19. The Joint Committee will be aware that Betfair sees its business as being no different – other than in the provision of choice, control, and better value – from a traditional bookmaker (who will now fall under the category “general betting operator”). Betfair is concerned that creating a separate licensing category for betting exchanges will merely create a political football which traditional bookmakers will continue to abuse by lobbying for unnecessary regulation in order to impede or undermine betting exchanges in any way possible. Betfair understands however the desire of government to maintain flexibility going forwards in case the betting exchange business model generates regulatory advantages or disadvantages which genuinely do merit differences in treatment. For example, the fact that a “pure” betting exchange operator takes no risk, means that an applicant should not have to prove an ability to manage risk positions. A betting exchange operator who does want to start taking risk will have to obtain a general betting operating licence as well and, as part of the application procedure, prove that it can manage the risk positions it intends to take. Most betting exchanges will no doubt apply for both licences so that they can participate in their markets as and when they see fit. This accords with the principle that betting exchanges should merely be viewed as traditional bookmakers who have taken the decision to minimise risk (as any traditional bookmaker can and often will do) by only taking one bet when they know they can find another punter to take the other side of that bet, locking in a profit by effectively adjusting down the odds offered to each punter by charging a small commission.

20. Betfair welcomes the removal of the word ‘bookmaker’ from the new legislation. As Clauses 4 and 21 of the Gambling Bill demonstrate, the need for regulation arises out of the risks presented by providing facilities for gambling to the public. It has nothing to do with “making books” (a meaningless term in any case since anyone placing a bet on an event is “making” his own “book”) or indeed betting activity generally. Furthermore the current legal definition of “bookmaker” is so ambiguous as to be virtually unintelligible.

21. Clauses 16 and 64(3) of the Draft Bill state that the Gambling Commission may issue a code of practice about the manner in which facilities for gambling are provided. In addition, Clause 63 states that the Secretary of State may attach conditions to operating licences. We welcome the requirement for compliance with such a code. Providing the Commission maintains a balanced outlook for all sections of the gambling industry, and does not succumb to pressure by the major vested interests to prejudice other operators merely because they pose a competitive threat to those vested interests, we see this step as wholly positive.

22. Betfair would ask the Committee to suggest that the draft codes of practice and licensing conditions are published at the earliest opportunity.

Protection of the vulnerable

23. Betfair believes that this is the one area in which the Gambling Bill can be strengthened.

24. Although the problem is clearly not specific to gambling, betting operators – and not just those on-line - have difficulties in ensuring that a customer is older than 18. Betfair would welcome any help that the government could give the gambling industry by pressuring the banking industry to take its own responsibilities in this area more seriously. Betfair has no commercial interest whatsoever in taking bets from under-18s, because to do so could be exceptionally damaging to the company’s reputation and to its business as a result.

25. Specifically, a bank card (such as a solo card) which can be issued to children as young as 12 could easily carry an identifier in its number, marking out its owner as being younger than 18. Currently, Betfair’s means of ensuring that a customer is older than 18 is through checks conducted via an external agency, which makes use of the electoral roll. As is true of all the aims of gambling legislation, this key aim is best achieved at source – that is, at the banks.

26. In a separate area, the Joint Committee will be aware that Betfair has launched a staff- training initiative with GamCare, to raise awareness of the issue of problem gambling, and ensure that its employees know how to react to customers who might be vulnerable. It is Betfair’s hope that the rest of the gambling industry adopts this sort of initiative as best practice, but Betfair has also suggested to DCMS that such a programme could be required by law.

Other items in Draft Gambling Bill - The Policy

27. There are a number of issues raised in the policy document which accompanies the Draft Bill, all of which Betfair strongly supports. We are strongly in favour of the provision of a revised offence of cheating, including interfering with the outcome of an event on which betting takes place with the intention of securing financial advantage. If all operators had the same strength of audit trail as Betfair allowing them to link all transactions to an end user, and all transactions to each other - and an obligation to share that information in certain
circumstances with the regulators, the maintenance of such a provision would be much easier. However, the provision itself is a good start in this regard.

28. We support in principle the idea that the Gambling Commission will have the power to freeze and void bets. The measure must however be used proportionately and selectively. There should be no interference with anything other than suspect accounts and there should be obligations on operators and regulators to identify and isolate these accounts as quickly as possible so as to minimise disruption to all other legitimate gambling activity. It should be noted that this measure will only work to deprive a suspected wrong-doer of his winnings. It will be impossible to reimburse all the punters across the world who were effectively defrauded by the wrong-doer. The measure must also be applied to all operators. Currently, it is likely that only technological platforms such as our own will allow operators to comply. This fact would undermine the proposal, because, as discussed in earlier submissions at length, corruption is not limited to new platforms.

29. The policy document also includes plans for a Code of Practice to tackle money launderers. Again, Betfair is in support of any strengthening of regulation in this area – although it is less-relevant for an operation like Betfair which has such a strong audit trail. We have strict money-laundering procedures and checks, which were demonstrated to the Joint Committee in its visit to our offices.

Impact on the bookmaking industry

30. Betfair’s impact on the bookmaking industry has been minimal. Our own estimates suggest that we have between 2% and 3% of the bookmaking market. What impact we have had is in any case in the nature of a free-market economy, since we offer the consumer choice and value.

31. Our impact on competitors is perhaps best measured by their own results. William Hill floated in June 2002 at a share price of £2.25. As at close of business on 9th December 2003, its share price stood at £4.11. In addition, the reports of those bookmaker firms which publish their results reveal that the bookmaking industry is enjoying a golden era. The following quotes from those reports are illustrative of the position:

• William Hill (8 Sept 2003) announcing its half-year results for the 26 weeks ended 1 July 2003: “Turnover up 72% and gross win up 18% to £324m; profit on ordinary activities up 27%; interim dividend up 21%.”

• Hilton Group, owners of Ladbrokes (20 Nov 2003) announcing its trading statement for the four months ended 31 October 2003 “Group profit increased by 15.1% mainly reflecting a strong performance in the Betting and Gaming division”

• Stanley Leisure (21 Nov 2003) publishing a trading statement to update the City since its AGM on 10 September: “A good performance has been seen in traditional betting, with a ‘significant’ uplift seen from the company’s fixed odds betting terminals.

32. Some of the traditional bookmaking firms have suggested that it is the funding of horseracing that is being impacted and put at risk. They have suggested that the perceived funding shortfall in the horseracing industry is the result of margins which they claim to be being impacted by exchanges, rather than by the gradual movement of their own business onto other products, for commercial reasons.

33. Members of the Committee will have received a copy of Betfair’s document ‘The Funding Question’, which lays out the reasons why Betfair is not the cause of funding issues, as some have suggested. Over 60% of horseracing business that goes through Betfair is generated on products which are not offered by the traditional bookmakers: trading (that is betting and laying the same horse to create a profitable margin) and betting in-running during a race. In addition, 25% of Betfair’s business (and rising) comes from overseas, which is a very positive contribution to the UK’s balance of trade and economy.

34. It is also worth noting, as was pointed out in a letter from on-course bookmaker Stephen Little to the Racing Post on 2nd December 2003 that the ‘there was no shortfall in levy yield [under the 42nd levy scheme, as is being claimed] but an overestimate, as the yield was, as usual, higher than the previous year's. In fact, horseracing is being funded at the highest level in its history, and this year the industry is currently on target to hit the funding figure projected for the 43rd Levy scheme.

35. Betting exchanges pay betting duty and horseracing levy on their gross profits just like all bookmakers. Betting exchanges choose to operate a low-margin, high-turnover business, but they should not be penalised for that any more than Ryanair should pay corporation tax on a different basis to British Airways. Betting exchange users are merely punters and they should not be subject to regulation and tax just because betting exchanges always allow them to bet on outcomes not to happen or request better odds as opposed to traditional bookmakers who only sometimes do.


36. Betfair welcomes strong regulation, and welcomes the provisions of the draft Gambling Bill. It believes that the government will hit its three primary targets outlined in A Safe Bet for Success, while not over-regulating, by licensing the operator not the customer.

37. In areas of integrity and funding being considered by the Committee, Betfair is confident that it is an ally of the racing industry, and not a threat. Our audit trail which tracks and traces bets, provides a formidable tool against anyone who tries to cheat the racing industry. Betfair has attached independent commentary from, and correspondence to, the Racing Post which backs up that view. Only vested interests have opposed it to date.

For old articles (from 1st March 2000) go to the Newslink Archive

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