NRL betting commission explained in 30 word or le please

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Shamrock
Posts: 205
Joined: Thu Sep 30, 2010 11:41 am
Location: Perth Wester Australia

Hi Everyone,
Recieved the email below yesterday re NRL commission and a turnover charge, can someone explain to a dummy in plain english?

Hi,

At Betfair, we are committed to constantly improving the Exchange to make it a vibrant, optimised experience, and to ensure that our product offerings are sustainable for all customers.
As you may know, we pay product fees to racing and sporting bodies in Australia and overseas that allow us to offer betting markets on their products. The product fee models adopted by the racing/sporting bodies differ; for example, the AFL charges Betfair a percentage of commission received, while the NRL charges Betfair based on back bet volume. We set our charges for a particular product based on the product fee model which is in place. Accordingly, the Market Base Rate (MBR) for AFL markets is 2.5%, while the MBR for NRL markets is 10% (as the NRL charges a significantly higher product fee).
In line with the high product fees that Betfair pays on NRL, we have instituted an NRL Turnover charge to ensure that we can continue to offer these markets for all customers.
We take decisions like this very seriously and do so in line with our vision to continually improve the Exchange for the benefit of all customers.
The NRL turnover charge will apply to customers who, in a week during the NRL season (Monday to Sunday GMT), meet each of the below criteria:


NRL Turnover Charge Criteria
Matched back bets placed in 1 or more NRL Turnover Charge Markets
Matched back bets with an aggregate value of AUS $1,000 or greater on NRL Turnover Charge Markets
Total Commission generated on NRL Turnover Charge Markets is less than 0.65% of aggregate matched back bets
NRL Turnover Charge rate calculated and applied separately from the NSW THO Turnover Charge
The Turnover Charge will be 2.00% of the aggregate value of matched back bets on NRL Turnover Charge Markets.

Total commission generated is half of the commission paid plus half of implied commission, calculated by the formula = (commission paid + implied commission) ÷ 2.

A worked example at the conclusion of the text as well as what activity is in scope of the charge.

Please note that the NRL Turnover Charge is incurred separately from the RNSW Turnover Charge.
The NRL Turnover Charge is a charge which applies to a very small number of customers betting on NRL and certain rugby league markets and engaging in specific activity that is associated to large back bet positions and minimal winning positions and eventual total commission generated.
Customers will be contacted by Betfair (via email or phone) and informed on the first occasion on which an NRL Turnover Charge would have been payable (whether old or revised NRL Turnover Charge).
Customers will also be afforded a one-week ‘grace period’ for the first instance they hit the NRL Turnover Charge, this is designed to give them an opportunity to refine their betting habits should they wish to do so. Customers that have hit the pre revised NRL Turnover Charge (2020 season) will not be granted a one-week ‘grace period’ as this has already been afforded.
A summary report of an individual’s weekly activity will also be available if requested.
Customers seeking further information can call 1300 238 324 (9am – 7pm AEDT) or email [email protected].
Full details can be found in our Customer Terms and Conditions.
(see http://www.betfair.com/www/GBR/en/about ... /#Turnover)

The NRL Turnover Charge will be applicable to markets offered on the following events and outright markets (NRL Turnover Charge Markets):
• Matches played in the NRL and NRLW Competitions (including final’s series);
• Men’s and Women’s State of Origin Matches;
• Test matches played in Australia and New Zealand;
• Test matches and other matches played by the Kangaroos as part of the “Kangaroos UK Tour”;
• All Stars Match;
• NRL Nines;
• Matches involving NRL Clubs that are not part of the NRL Competition played in Australia or New Zealand or overseas (for example, the World Club Challenge);
• New South Wales Cup and Queensland Cup; and
• Fantasy Football markets.
________________________________________

NRL Turnover Charge: A worked example
What activity generates low commission (below the criteria for the NRL Turnover Charge)?
Back betting at low odds (less than 1.10) in play and trading at odds gaps less than $0.12.
The below example shows how total commission generated is calculated as well as taking you through an example of the Turnover Charge rate calculation.






Example NRL Match Odds R1 Market - Storm vs Panthers - Storm Win
Selection Bid Type Volume Odds Winnings
Storm Back $ 100.00 1.02 $ 2.00
Storm Back $ 100.00 1.03 $ 3.00
Storm Back $ 600.00 1.01 $ 6.00
Raiders Lay $ 10.00 6.00 $ 10.00
$ 21.00 Total Winnings
Total Back Bet Volume $ 800.00 $2.10 Commission paid (10% MBR x Winnings)
Implied commission ($0 x 3%) [No net loss on the market]


Example NRL Match Odds R1 Market - Roosters vs Raiders - Raiders Win
Selection Bid Type Volume Odds Winnings
Raiders Back $ 100.00 1.70 $ 70.00
Raiders Lay $ 60.00 1.65 -$ 39.00
Raiders Back $ 100.00 1.20 $ 20.00
Roosters Lay $ 30.00 2.50 $ 30.00
$ 81.00 Total Winnings
Total Back Bet Volume $ 200.00 $8.10 Commission paid (10% MBR x Winnings)
$ - Implied commission ($0 x 3%) [No net loss on the market]











Example NRL Match Odds R1 Market - Panthers vs Titans- Titans Win
Selection Bid Type Volume Odds Winnings
Panthers Lay $ 100.00 1.70 $ 100.00
Panthers Lay $ 60.00 2.45 $ 100.00
Titans Lay $ 170.00 1.20 -$ 34.00
Titans Lay $ 120.00 2.50 -$ 180.00
-$ 14.00 Total Winnings
Total Back Bet Volume $ - Commission paid (10% MBR x Winnings)
$ 0.42 Implied commission ($14 x 3%) [Net loss on the market of $14]
Total Commission Generated = (commission paid + implied commission) ÷ 2

Commission Paid $10.20
Implied Commission $ 0.42
Total $10.62
Total commission Generated $5.31 Divided by 2 to proportion the commission between winning and losing bets

Total Back Bet Volume $ 1,000.00

Total commission Generated as a % of Back Bet Volume 0.53% Under the 0.65% threshold for Turnover Charges

Turnover Charge Payable (2% of Total Back Bet Volume) $ 20.00



Kind regards,
The Betfair Team
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gazuty
Posts: 2547
Joined: Sun Jun 26, 2011 11:03 am
Location: Green land :)

Shamrock wrote:
Fri Apr 16, 2021 4:18 am
Hi Everyone,
Recieved the email below yesterday re NRL commission and a turnover charge, can someone explain to a dummy in plain english?
Peter V’landys does not like betfair.

https://www.smh.com.au/sport/nrl/v-land ... 512ur.html

If you back and match more than $1,000 on nrl expect turnover charge.

///

What follows is well over your 30 word limit.

V’landys considers betfair a normal bookmaker and so nsw racing and nrl charge betfair as if betfair was a normal bookmaker and was accepting bets not taking a commission from those who make up the exchange. So betfair get charged on market turnover (just like a normal bookie operating with say a 120% overround). But betfair are not operating on any over round and need to find a way to pass that cost on to users of the exchange. Because without layers there will be no exchange and layers are more likely liquidity providers than backers because more backers are regular punters betfair have decided to charge backers.

It is very easy to create a synthetic back bet in nrl (two outcome markets) instead of backing.
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