Wednesday 9th March 2011

Update on the Betting Exchanges Consultation

In July 2010, the Horserace Betting Levy Board (HBLB) began an extensive consultation process on various questions relating to the issue of whether certain users of betting exchanges should be regarded as leviable bookmakers for the purpose of the Levy.

The consultation document, which had been distributed to interested parties and published on HBLB’s website, set out various issues and requested consultees’ views on these and any other issues they considered relevant.

Following receipt of submissions in the consultation process between July and November 2010, HBLB received two legal opinions from Michael Fordham QC and Lord Pannick QC in December 2010 and February 2011 respectively. The legal opinions were in agreement on the following key points:

a) On the proper construction of the Betting, Gaming and Lotteries Act 1963, the Levy provisions do not apply to customers of betting exchanges.
b) It is possible that some users of betting exchanges are carrying on a business.
c) However, a user of a betting exchange does not carry out the sort of business specified by the relevant provisions of the 1963 Act – namely, carrying on a business of receiving or negotiating bets and effecting betting transactions.
d) That applies also to traditional bookmakers using betting exchanges.

Board members, who received these opinions only very recently, wish to have more time to consider them and intend to consider the issues raised in the consultation paper and the responses, and the two legal opinions, at a forthcoming Board meeting. Meanwhile, both legal opinions will today be published on HBLB’s website (here).

If anyone wishes to express any views to HBLB on the two legal opinions, they should do so by 5pm on 8th April 2011.