No more Betfair Germany

With Betfair building a model that will be promoted as "fixed odds" will make the "exchange" argument more difficult.

That said, all bookmakers are "exchanges" onto themselves.

They have banned betting on greyhounds and horses on here in Denmark.

The Danish racing thing isn't Betfair's doing - the Danish regulation and legalisation of online gambling explicitly restricts betting on Racing to the Danske Spil state monopoly.

No they Eu won't, it's being like that in France for years and have done nothing

@InsiderTrader

On its way:

http://www.hm-treasury.gov.uk/consult_remote_gambling_review.htm

(Reuters) - Betfair Group Plc (BETF.L) has withdrawn its online sports betting exchange in Germany, blaming a 5 percent turnover tax for making its main product unviable in Europe's largest economy.



Companies in the growing online gambling market complain of a patchwork of different regulatory regimes and tax systems across continental Europe. They are focusing their expansion efforts on those countries where there are clear rules and less onerous tax regimes.

Betfair, which launched 12 years ago and operates an exchange system that allows gamblers to bet against each other rather than the bookmaker, argued it should not have to pay the German tax.

Germany is a relatively small part of its business, accounting for around 4 percent of core revenue in its last financial year.

"The company is disappointed that to date the tax authorities have not been able to agree to an interpretation of the law that would allow Betfair to continue to offer the exchange product," Betfair said on Wednesday.

"Consequently, Betfair has decided to withdraw its exchange product from the German market," it added.

Betfair said contributions from Germany would be minimal following the withdrawal of the product. Besides the sports betting exchange, it also offers poker, casino and more traditional fixed-odds betting there.

Betfair shares initially opened lower but recouped the losses to trade 1.8 percent higher at 765p by 1020 GMT.

Analyst Nick Batram of brokerage Peel Hunt said he had already factored a German withdrawal into his forecasts after previous statements from the company.

"We believe that there is the potential to create a much leaner and meaner business, with the unique exchange platform at the core," said Batram, who has a "buy" rating on the stock.

William Hill (WMH.L), Britain's largest bookmaker, said it no longer offered any kind of service to German residents because of the tax situation.

"We remain licensed in Spain and Italy, and have recently developed a Swedish language website and started advertising in print and broadcast media there," spokeswoman Kate Miller said.

Bwin.party (BPTY.L), the world's largest online gaming group, said last week that the German tax had contributed to a decline in revenue in the third quarter.

Bwin has amended its business model in Germany, its largest market, by no longer accepting very short-odds bets on sports events there.

here we go     07 Nov 12 15:49 
A simple solution would be to xfer the turnover tax to the customers and let them decide wether the prices/odds including the tax are attractive.

that is not a solution , nobody in their right mind would place bets under those circumstances

If Betfair don't like the tax they can go elsewhere (that's what they tell us about Super PC).

I think the end for Betfair is not far away

Let's hope the European Commission will fix this incompetent bs politician performance soon...

Depressing news. Slowly the map of europe is getting filled with Xs of countries betfair is unavailable or limited in :(

once upon a time people got pretty testy when corrupt government officials created monopolies to expropriate them

often they simply killed the taxman

"nationalised exchange" is just what these control freaks are doing under a different flag.

That isn't what they're doing at all. They're protecting the revenues they receive from the parasitic middlemen who take the bulk of the revenues. Why do we need these parasitic middlemen? The middlemen (e.g. bookmakers) would be free to ply their trade through the nationalised exchange if they were capable. No doubt we'll now get your "free marketeers" prattling on about nationalised exchange 25% commission rates and such cr@p. All drivel as there's a point at which commission increases bring about a decrease in profits. Sure we'll end up with winners being taxed on their profits but that's already happened on betfair.

It's not that long ago we had Gordon Brown addressing a division of betting industry leaders (i.e. a shower of w@nkers in camel haired coats who'd purchased some off the shelf gambling site software) attempting to persuade them to make Britain their base where punters would be given the protection of the GC (). How ridiculous was that? Why not just have a nationalised exchange where the government get all the profits and punters would get genuine protection.

Any nationalised gambling always seems to rips off consumers though. Lottery margins etc. Dutch nationalised football betting is about 15% margin I believe (toto).

The whole point of nationalised gambling is always in practice monopolisation (often under the guise of protecting people from unscrupulous operators).

We might see this happen in Asia/USA in decades to come (although pretty unlikely), in which case Betfair would lose out massively to the huge liquidity pools there if they did it properly. They will probably manage to mess it up royally with the usual government bureaucracy and lack of business sense though.

This is based on history. Lottery operators are allowed to pay themselves ridiculous sums. If you are allowed to run a monopoly business that generates huge profits by default, you should not reap huge financial benefits. Same applies to the banking oligopoly.

I don't think banks should be nationalised, but I think that with things like creating money out of nothing and then lending it to people at interest, the bank should be seen as nothing more than a government agent and be rewarded as such. A banking licence should also come with a requirement to build up a fund for failed banks (mandatory insurance, just like car owners are required to have), rather than the taxpayer guaranteeing peoples deposits for the banks for free. It's always the rich that profit from these measures rather than the consumers it is supposed to help (same with tax breaks on mortgage interest).

margins for german nationalised sports gambling company oddset are almost at 50%. often they won't allow singles and live betting is entirely out of the question as their highly skilled government-bookmakers (so called Galitzins) of course are unable to compute those odds in real time

so any backward pro-nationalisation socialist/fascist will happily do a 3 way bet to support government salaries/bank bailouts in the future

@Galitzin

Have worked fine for whom?

That´s the fundamental question here. We all know the answer.

"For horse-racing, a nationalised exchange, or one run by non-profit racing authorities is the way to go for the future funding of the sport."

They already have one.  It's called The Tote and it's rubbish.

Or

Are you advocating the governement purchases Betfair's racing exchange marginalising the sport even further?

Or

Are you advocating the goverment start their own exchange and compete in the market place? which wouldn't compete and just be a money pit.