New Aus Pricing Structure

[mugsgame]

Many customers will be aware of the recent Australian High Court ruling requiring wagering operators to pay a fee based on turnover to accept bets on New South Wales thoroughbred and harness racing. Racing Victoria and Racing Queensland are both also moving to a fee regime based on turnover with Queensland commencing on 1 August 2012 and Victoria expected on 15 August 2012.

Betfair has been reevaluating its pricing structure in the wake of these decisions and it has been determined that regretfully in order to ensure we continue to offer the best wagering product in the market and to give our customers continued access to all Australian racing content, a turnover charge will be applied to a very small group of customers who meet specific criteria. The charge will only be applied on those markets which Betfair is required to pay a turnover fee. For a complete listing of jurisdictions affected by a turnover fee please refer to this link.

The turnover charge is being applied to customers in exactly the same way as the racing bodies are charging Betfair, however at a smaller rate. Therefore Betfair continues to absorb a portion of the fee it is being required to pay.

The new turnover charge is applicable to a very small group of customers. It is necessary to ensure Betfair can continue to operative viably on turnover charge markets. The turnover charge is aimed at customer activity which generates large volumes of back bets without providing Betfair with the corresponding revenue to cover the charges accrued. Therefore without the charge Betfair would be left with a turnover fee payable to racing bodies but no revenue with which to pay it.

WHO WILL PAY THE TURNOVER CHARGE?

This charge will only apply to customers who during a week meet all three of the below criteria:
have matched back bets on 50 or more markets which Betfair is subject to a turnover fee from a racing body ('turnover charge markets');
have matched back bets with an aggregate value of $2000 or greater on turnover charge markets; and
the total commission generated by the customer on turnover charge markets is less than 1.5% of the aggregate value of matched back bets placed by the customer on those markets.
Total commission generated is half of the commission paid plus half of implied commission, calculated by the formula = (commission paid + implied commission) ÷ 2.

Implied commission is 3% of player losses where players make an overall loss on a single market.

Turnover charge markets will be identified in the grey text of the market view.

WHAT IS THE CHARGE?

The turnover charge will be 1.2% of the aggregate value of matched back bets on turnover charge markets.

Betfair is being charged 1.5% of the aggregate value of matched bets by Racing NSW, Harness Racing NSW, Racing Victoria and Racing Queensland. In both Victoria and Queensland this rate increases to 2% for their premium racing months. You can see a current list of the tracks that the charge applies to here.

The charge will be calculated for the period from each Monday to Sunday (GMT), and will be payable on a retrospective basis. The charge will be debited from a customer's UK wallet each Wednesday, alongside any applicable premium charge.

The charge will only be incurred for any week when a customer's betting activity meets the criteria. Please note the charge will not be applicable to any lay bets.

EXAMPLE OF THE TURNOVER CHARGE

During a weekly cycle, a customer has matched back bets to an aggregate value of $10,000 over 100 NSW and Victorian thoroughbred markets. The customer has $100 in Total Commission generated.

Criteria:

CRITERIA APPLICABLE ACTIVITY
Back bets placed in 50 or more turnover charge markets YES 75 turnover charge markets
Matched back bets with an aggregate of $2000 or greater on turnover charge markets YES $10,000 of matched back bets on turnover charge markets
Total Commission generated on turnover charge markets is less than 1.5% of aggregate matched bets YES $100/$10000 = 1%


Turnover Charge payable will be 1.2% of $10,000 = $120.

HOW WILL I BE NOTIFIED IF I AM REQUIRED TO PAY THE TURNOVER CHARGE?

Customers will be contacted directly by a Betfair representative and informed on the first occasion on which this turnover charge would have been payable.

Customers will also be afforded a one-week 'grace period' designed to give them an opportunity to refine their betting habits should they wish to do so. The first notifications to affected customers who have triggered the grace period will be sent the week of August 6, 2012.

A summary report of an individual's weekly activity will also be available if requested.

Betfair remains committed to providing our customers with the best products and service in the market and the implementation of this turnover charge is imperative to the future sustainability of the business.

Despite this new charge, Betfair's prices will remain the best of any wagering operator on Australasian racing.

Customers seeking further information on this pricing alteration can call the Betfair Helpdesk on +44 844 871 0000 or email us at [email protected].

Kind regards

The Betfair Team

[gazuty]

Oh boy.

Thanks for the heads up Mugsy.

[Euler]

mg, did you get sent an email?

[mugsgame]

mg, did you get sent an email?

yes

[Euler]

That's the thing that annoys me with Betfair. I didn't get a thing!

[gazuty]

Same nothing for me either, but thanks to this Forum I was updated and able to contact them.

Whenever I call betfair I am put through to the "premium" section - whatever that is? I'd hate to be an ordinary customer since they couldn't be bothered to email a so called "premium" customer.

Plus I was "suspended" from all NSW events. You would think they would want me back and taking my commission. But I had to ask them.

Any way thanks to this forum.

[fuzzer54]

I have had one of these letters this afternoon, and am awaiting a reply about exactly what i would have paid over the past seven days.
What have other traders in the Aussie markets found?
Will it be worth me trading on these markets in the future or will they take all my profits?

[fuzzer54]

Well. Have had my answer now and it's pretty clear that getting up early to do the Aussie racing will be a complete waste of my time from now on. Will have to see if it's viable to avoid the tracks in New South Wales, Queensland and Victoria, but it seems rather unlikely. What a greedy lot they are!

[CaerMyrddin]

Did you get a 'warning' call from them today?

[fuzzer54]

Well an email saying I would have been liable to the charge, but you do get a week's grace so I won't be charged for any trades made up to now. But the amount I would have paid amounted to about 75% of my profits from Aussie racing for the week, so clearly not sustainable for me any longer. And if you traded badly, you could easily end up losing money and still being stung with the transaction charge. At least with the premium charge you only pay a proportion of your profits. I just hope the horse racing authorities here don't follow suit. Otherwise the party's over!

[CaerMyrddin]

Just got the email as well, things are looking slim to bf Australia...

[Euler]

No email here, what are they saying? Is it a summary of your activity or the one we saw earlier that was sent to Betfair AUS customers?

[CaerMyrddin]

It's a new one, saying you are due to pay an x amount for your activity, but clearing you for this week.

It has no summary of your activity, simply the value you were to pay...

Btw, I never got that previous email, but my phone rang and I was told that I should only lay selections on all Australian racing. Go figure...

[marksmeets302]

Just got the email. For me it's like an extra 20% commission. I just wrote them this email:

Dear Carl,

It's not mentioned if these charges are offsetted with the premium charge, so I assume they aren't. For me, this is disappointing, but in line with the constant attempts to evidently drive away the liquidity providing customers. I will keep my strategy as it is and monitor if after the charges it becomes a net loser. If so I'll kill the strategy. I will not make any attempts to fix things as I have made clear earlier that as long as the inequality between customers is present (aka the premium charge) I will not invest any substantial time in Betfair any more.

[rubysglory]

Hear what you are saying but doubt the care. The sooner BF pull their Australian license and relocate offshore to the Pacific Islands the better long term. Pull the license, relocate and make the Racing bodies bleed.

rg