Online sportsbetting provider Betfair has files suit in the Federal Court of Australia challenging the validity of decisions by Racing New South Wales and Harness Racing New South Wales to impose a 1.5 % turnover fee on all wagering operators that cover thoroughbred and harness races in the state. Betfair alleges that the fee constitutes discriminatory conduct in interstate trade and commerce under Section 92 of the Australian Constitution.

Betfair alleges that the fee constitutes discriminatory conduct in interstate trade and commerce under Section 92 of the Australian Constitution and succeeded earlier this year in a separate similar action against the government of Western Australian.

“We’re happy to pay a fee to the New South Wales racing industry on all our wagering revenue but the turnover fee imposed by Racing New South Wales and Harness Racing New South Wales is highly discriminatory, said Andrew Twaits, Director of Corporate and Business Affairs for Betfair.

“The fee equates to around 60 of our gross revenues but less than 10 of TAB’s revenue. Both Racing New South Wales and Harness Racing New South Wales are fully aware that it’s impossible for us to compete on those terms. They’ve left us with no option but to challenge the validity of their decisions.”

“The only fair basis on which to charge for race fields is to implement a gross revenue model where every wagering operator pays at the same rate. That way, even if there is any transfer of customer expenditure from the TAB to other wagering operators, the New South Wales racing industry will continue to get the same proportion of revenue from every dollar spent by punters.”

Betfair is licensed as a wagering operator in Tasmania and is legally permitted to accept bets from customers throughout Australia. It revealed that it already pays tax and product fees to Tasmania equating to 35 % of its gross revenues.