Landmark Code of Practice Published By Bloodstock Industry
Published: 6 July 2004
LANDMARK CODE OF PRACTICE PUBLISHED BY BLOODSTOCK INDUSTRY
A Code of Practice for the British bloodstock industry was published today. The Code applies to all sales of bloodstock sold privately and at public auction as well as sales of stallion shares and nominations.
The Code, which will take effect from 1st August, is designed to increase the transparency of all bloodstock transactions and by doing so safeguard the interests of all parties. Alleged breaches of the Code will be reported to the Jockey Club and if the Jockey Club is satisfied there has been a breach the individuals concerned could be banned from British racecourses and other licensed premises. Previously, the Jockey Club had no jurisdiction over the bloodstock industry.
The Code was developed following two meetings held earlier this year chaired by the Jockey Club’s Senior Steward, Julian Richmond Watson, and attended by representatives of the owners, trainers, breeders, bloodstock agents and sales companies.
Jockey Club Senior Steward, Julian Richmond-Watson, said today: “The publication of this landmark Code of Practice underlines the British bloodstock industry’s commitment to promoting confidence in the integrity of the industry. The initial meeting was called following some negative publicity which reflected poorly on both the bloodstock industry and racing as a whole, however, the introduction of the Code should be seen as a very positive development.
“The Code promotes full disclosure for all arrangements arising from any bloodstock transaction and should alleviate previously expressed concerns about a lack of transparency. I have been impressed by the willingness of the parties concerned to work together to produce a comprehensive document. The Jockey Club is happy to endorse the Code and to issue penalties where there is evidence of a breach.
“Although the Code currently only applies to British transactions, I hope that other bloodstock trading countries may follow suit and adopt the same code or something similar.”
The bloodstock summit meetings held earlier this year were attended by representatives of the Irish Turf Club. Interest in the progress of the Code has also been expressed by racing authorities in Australia and the Society of International Thoroughbred Auctioneers (SITA) gave their unanimous approval to the Code at their Annual meeting last month.
6th July 2004
Notes for Editors:
1. The background to the development of the code is as follows:
a) In March 2003 the Jockey Club introduced to the Rules of Racing a Code of Conduct designed to increase transparency in dealings between trainers and owners.
b) In December 2003 a newspaper reports on a court case which arose from a dispute about the collapse of the sale of Foodbroker Fancy. Although the case was ultimately settled out of court, prior to the settlement the judge publicly expressed his concern about the manner in which the planned sale was conducted.
c) In January 2004 the Jockey Club reaffirmed its position regarding its concern about a lack of transparency in bloodstock transactions and invited representatives of the bloodstock industry to attend a meeting to discuss the issue.
d) Following a meeting held in April 2004, a working group under the chairmanship of Philip Freedman, Chairman of the TBA, was established and tasked with developing a code of practice for the bloodstock industry. There was a further meeting in May at which the working group reported on the progress of the document.
2. Bloodstock agents are not licensed by the Jockey Club or any other organisation, however, under the Code of Conduct if an agent is found to have committed a breach of the Code he may be banned from British racecourses and other licensed premises.
3. The Code of Practice has been drawn up and published by the following organisations:
British Horseracing Board
Doncaster Bloodstock Sales Ltd
European Federation of Thoroughbred Breeders’ Associations
Federation of Bloodstock Agents
National Trainers Federation
Racehorse Owners Association
The Jockey Club
Thoroughbred Breeders Association
A copy of the Code is attached and is available to view on the Jockey Club website, www.thejockeyclub.co.uk. The code will also be reproduced in the sales catalogues produced by Doncaster Bloodstock Sales Ltd and Tattersalls Ltd.
THE BLOODSTOCK INDUSTRY CODE OF PRACTICE
The Code of Practice sets out the principles which apply to all sales of bloodstock and sales of stallion shares and nominations, be they private sales or sales at public auction, ensuring that sales of bloodstock in Britain set and maintain a high standard of integrity and transparency, which will safeguard the interests of vendors, consignors, bloodstock agents, owners, trainers and the sales companies.
• “Agent” means any trainer, consignor, bloodstock agent, racing or stud Manager or other person or entity who represents a Principal in the sale or purchase of bloodstock, stallion shares and nominations, whether the Agent is paid by way of retainer, commission or other forms of remuneration, or has ongoing financial arrangements (for example the payment of management or training fees), or not.
• “Principal” means a person or entity who appoints an Agent to act as agent on his behalf in the sale or purchase of bloodstock, stallion shares and nominations as in the definition above.
• For clarification, words importing the masculine gender shall include the feminine.
1. An Agent owes a duty to his Principal to act at all times in accordance with his Principal’s best interests.
2. An Agent shall not place himself in a position where personal interests conflict with the duty to his Principal. In particular, an Agent shall not use his position to obtain a secret profit.
3. When an Agent acts as a vendor or part-vendor and sells or intends to sell any horse in which he has an interest to a Principal, or intended Principal, the Agent must disclose to his Principal, before completion, the full extent of that ownership or interest and the benefit derived from that transaction.
4. If an Agent acts for more than one Principal in a transaction (which might be both the vendor and purchaser), the Agent can only do so if he has first disclosed this fact, before completion, to all his Principals, and obtained their consent.
5. An Agent must notify his Principal, wherever possible in advance, when a conflict of interest could arise, such as transactions involving third parties with whom he has a retainer, transactions where he is aware he will benefit from a third party, or transactions concerning horses which he has previously purchased or been involved with.
6. An Agent shall disclose to his Principal and, if required, account to his Principal for any Luck Money paid to him by or on behalf of a vendor. “Luck Money” refers to any financial payment or payment in kind made by or on behalf of a vendor to a Purchaser or his Agent, after the sale of a horse has been concluded.
7. If an Agent receives an offer to purchase a horse he must relay that offer in its entirety to his Principal and respond in accordance with the Principal’s instructions.
8. A vendor must not offer an