Betfair, Bwin, Ladbrokes Respond to FFT Proceedings

5 February 2008

Betfair, Bwin and Ladbrokes are cautioning French tennis authorities that their efforts to ban legal, regulated betting at the upcoming French Open could backfire.

On Friday, the French Tennis Federation (FFT) filed lawsuits in Belgium and France against Betfair, Bwin and Ladbrokes, all of which are licensed and regulated, to prevent them from taking bets on the event. The tournament will take place in Paris over two weeks beginning in May.

The FFT has stated its concern for the integrity of the sport with regard to online betting.

"There is urgency to act because sporting ethic is at risk," FFT Director General Jean-Francois Vilotte told the Associated Press last week. "It is an issue as important as the fight against doping."

A team of three lawyers from Liege-based law firm elegis is representing the FFT. IGN spoke with a representative of the firm, who offered some background and insight into the case.

He acknowledged that the suits were prompted by the recent betting scandal involving Association of Tennis Professionals player Nikolay Davydenko. Ironically, it was Betfair that alerted the ATP to possible match fixing when it reported irregular betting patterns surrounding an August match between Davydenko and Martin Vassalo Arguello.

The suits are being filed on two grounds, according to the representative: injury to the image and reputation of the petitioner (the FFT); and free riding, which, in economic terms, means benefiting from a good or service without paying for it.

As for why the three operators are being targeted specifically, the elegis representative said that the firm was not able to sue all online gambling companies, so it chose three major ones. They are confident that a ruling in their favor would set precedent for a ban on all other companies.

Ladbrokes, Betfair and Bwin share one opinion: This action by the FFT, if successful, will only result in clearing a path for unlicensed, unregulated operators to attract customers looking to place a bet on this and other events.

"It is difficult to believe the worrying lack of understanding of an important issue being displayed here, and impossible to see what positive is being achieved," said Mark Davies, communications director for Betfair. "Targeting EU-licensed companies -- which are highly regulated -- to leave punters betting only with unlicensed operators across the Web not only misses the point, it actively exacerbates the problem which it is claimed is being dealt with.

"The French Open is being advised to target the only betting operator which is completely transparent and, where needed, shares all its betting information with the International Tennis Federation and ATP, which is plain bizarre," Davies continued. "It is apparently advocating opacity over transparency and obstruction over cooperation. I am astonished that any sensible lawyer would advise a client to go down this route."

Betfair, the only private company in the group, is planning on mounting a defense against the suit.

"We will defend it," Davies said. "We won't lose it."

Incidentally, as of today, Betfair has not received any communication from the FFT or its lawyers regarding the lawsuit.

Konrad Sveceny, head of investor relations at Bwin, said tennis accounts for about 10 percent of the company's gross gaming revenues from sports betting.

Sveceny observed moreover that as a major sport sponsor, it is in Bwin's interest to protect the integrity of sport.

"We see ourselves . . . as a partner of sport federations and are a founding member of the European Sports Security Association (ESSA), where members are committed to legal and responsible sports betting, including close cooperation with leading sport federations and regulators," he said. "As a major sport sponsor [of Real Madrid, AC Milan and others], it is in our interest to keep sport clean and free from insider betting and manipulation. That is why we have established the early warning system of ESSA to detect fraudulent activity. We are a highly regulated, EU-licensed company. Being quoted on the Vienna stock exchange we will always act in the interest of our shareholders."

Bwin was notified today by the FFT, Sveceny said.

Ladbrokes also believes that unlicensed, unregulated companies will only cause a greater problem.

"We will of course be defending our right to offer betting on an independent event as we have done for over 120 years of operation," said Ladbrokes PR Director Ciaran O'Brien. "Ladbrokes is a licensed, regulated operator offering bets on events all over the world."

The FFT's lawyers expect to initiate proceedings on Feb. 26 and hope for a judgment one month before the tournament begins.

Emily Swoboda is the senior staff writer at IGamingNews. She lives in St. Louis, Mo.