British Horseracing Authority Acting Chief Executive Chris Brand said:
“Levy yield is in alarming decline, as the mechanism fails to deal with the modern betting market. Yesterday, the Levy Board, a public body whose statutory duty is to collect Levy, failed to take the most obvious and necessary steps to arrest this decline, by not pursuing the professional users of betting exchanges who are a significant part of today’s betting landscape.
“For over two years now, the BHA has been calling upon the Levy Board to obtain definitive clarification on whether “in business” betting exchange users are liable to pay Levy. We have always maintained that this is essentially a legal question that can only be determined by the courts. Nevertheless, the Board decided to undertake a lengthy and expensive public consultation seeking views on this legal question. One of the Board’s own advisers, Michael Fordham QC noted in his opinion for the Levy Board that ‘it is ultimately only the courts who can authoritatively decide’. Instead we have had a year of procrastination whilst the financial outlook has worsened and the leading betting exchange, Betfair, has moved offshore, outside the jurisdiction of the Levy – although many of its users remain in Britain.
“Distinguished leading counsel instructed by the Levy Board, Racing, Betfair and the FRB do not agree as to the correct legal analysis. In such a circumstance, it is surely incumbent on a public body to seek clarification from the courts on this very important issue.
“Cost is now cited as one reason for not taking this matter to court, but the Levy Board must now have spent hundreds of thousands of pounds – of Racing’s money – only to get us to this position of uncertainty.
“Racing, represented by the Authority and the sport’s two stakeholder groups, the Horsemen’s Group and the Racecourse Association, has agreed and followed a united position throughout this process, as we have done on all government-facing matters in recent years. We are now reviewing all options.
“It would be no surprise now to see the £6m “voluntary” contribution to the Levy Board, committed to by Betfair, materialise. Some will claim that this would be justification for yesterday’s decision. However, Betfair’s own actions in cynically withholding this money, and their previous permanent withdrawal of a separate £1m voluntary payment, demonstrate why voluntary payments are no substitute for enforceable commercial arrangements that put betting exchanges on a level playing field with other platforms.”