Bill to Prohibit Exchange Betting Enters Western Australian Parliament

28 June 2006

On June 21 Western Australia's Minister of Racing and Gaming, Mark McGowan, introduced to the state's parliament Bill No. 146-- Betting and Racing Legislation Amendment Bill 2006-- which if passed into law would prohibit the operation of betting exchanges in Western Australia. The legislation would also prohibit the publication of Western Australian race fields without appropriate approval and would make it a punishable offense for anyone in the state to place a bet through a betting exchange.

Designed with the stated purpose of protecting the integrity of the Western Australian racing industry, Betting and Racing Legislation Amendment Bill 2006 would amend the Betting Control Act 1954 and the Racing and Wagering Western Australia Act 2003. The Bill's explanatory memorandum justifies its measures by stating:

The operations of betting exchanges pose a significant threat to the integrity of the racing industry. The ability to lay bets to lose through the medium of a betting exchange and thereby profit from a horse/dog losing, can be a real temptation for owners, trainers, jockeys, stable staff and others close to the industry. In this regard, the outcome can significantly compromise the integrity of racing.

The ability of individuals who may be in a position to influence the performance of particular runner to then take bets on that runner is a particularly invidious by-product of the betting exchange situation. The reality is that the ability to lay horses to lose offers a far easier opportunity than intending to arrange for a certain runner to win.

McGowan's bill would not only make it an offense to establish or operate a betting exchange in Western Australia, but would also make it an offense for a person in Western Australia to bet through a betting exchange. Any punter who uses a betting exchange could face the penalty of a A$10,000 fine or 24 months in prison or both. Incidentally, these are the same penalties to which operators of betting exchanges would be subject.

"I know there are many punters who like to bet through betting exchanges and punters are very important to the racing industry," said McGowan. "However, there needs to be an understanding that, by allowing betting to lose, betting exchanges can compromise the ongoing integrity of racing. Without well-controlled, good quality races, punters will have nothing to bet on."

To further protect the integrity of Western Australian racing, McGowan has also proposed a system similar to one recently enacted by the state of Victoria in which a licensing framework would only allow wagering operators that have been approved by the Minister for Racing and Gaming to use or publish Western Australian race fields. Applicants wishing to use the race fields would have to undergo a "public interest test" whereby the Racing and Gaming Minister would evaluate the integrity of the applicant's wagering activities.

McGowan introduced his bill June 21st and it consequently received a first and second reading before parliament. He says he expects his bill to become law before the end of the year.

Should the bill become law, it would be enacted in two phases. The first phase would consist of the provisions relating to the prohibition of betting exchanges while the later phase would involve the enactment of the race fields provisions.

Click here to view Betting and Racing Legislation Amendment Bill 2006.

Click here to view the Bill's Explanatory Memorandum.

Bradley Vallerius

Articles by Bradley P. Vallerius, JD manages For the Bettor Good, a comprehensive resource for information related to Internet gaming policy in the U.S. federal and state governments. For the Bettor Good provides official government documents, jurisdiction updates, policy analysis, and many other helpful research materials. Bradley has been researching and writing about the business and law of internet gaming since 2003. His work has covered all aspects of the industry, including technology, finance, advertising, taxation, poker, betting exchanges, and laws and regulations around the world.

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