British horse racing has taken another step towards a more secure basis of future funding with the signing of a commercial agreement with Betfair.  The betting exchange has in the past fallen outside statutory funding mechanism of the Horserace Betting Levy on bookmakers but has made voluntary payments since its inception in June 2000.
The deal will provide for a payment to racing of 10.75% of the revenues the company makes on the handling of horse racing bets from UK customers.  There is a minimum guarantee of £40 million (€49.7 million) over the course of the five year duration of this deal.  That will replace an approximate £18 million (€22.4 million) paid over the last three years on the voluntary basis.
The British Horseracing Authority who signed the deal are understood to have committed to a minimum number of fixtures, in line with current levy agreements, and the deal does align the interests of the two sides being based on a percentage of profit derived from the betting public.
The more and more attractive racing, the more people will bet on the sport, the more both sides will likely benefit.  Concerns within racing have been high for more than a decade that betting interest was being diverted away from racing towards soccer in particular where no such levy scheme exists, at least for the present.
The value of the overall levy has reduced from over £100 million (€119 million) to around £65 million (€80.9 million) in the current year.
Yesterday’s deal was approved and supported by the UK Government’s Department of Culture, media and Sport.
It was not welcomed by bookmaker William Hill which was due to announce legal action, in tandem with the racing authorities, seeking to change the point at which betting exchange levy is charged, from the operator to the individual layers on the site.  The British Horseracing Authority has now withdrawn from that case which the bookmaker will pursue alone.
The deal with Betfair will likely give rise to discussions on a similar agreement with Horse Racing Ireland for the benefit of the sport here.  Relations between Betfair and Horse Racing Ireland have been strained in recent years but perhaps an agreement in its principal market will allow for a basis for a fresh look here.
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