Bookmakers are peeved by a proposal made by Caymanas Track Limited (CTL) that will as of Saturday turn them into commisioned agents of CTL, the state-run promoters of local horse racing.

Effectively, CTL plans to take away 60 per cent of bookmakers revenue, which they make from bets made on local racing at their shops, and pay them a fixed commission.

CTL has called for wagers made at betting shops operated by bookmakers to, effective January 1, be electronically transmitted to the tote prior to the running of horse races and proposed that it will pay the bookmakers a commission of 5.5 per cent on the sales. Additionally, it has been requested that bookmakers pay a five per cent rights fee on bets not offered by CTL.

Up to press time yesterday evening, the bookmakers were meeting to decide how to respond to CTL’s demand, which one bookmaker said will “wipe” them out of business.

“If Caymanas has their way, it will not suit one bookmaker to operate one shop… It’s a double blow designed to wipe us out,” said the bookmaker who requested anonymity.

Bookmakers currently sell bets independent of CTL, to which they pay rights fees of 3.5 per cent of sales. They also pay 16.5 per cent tax on gross income to the Government.

CTL acting CEO and director of marketing Christopher Armond dismissed suggestions that the proposals were unfair to bookmakers.

“CTL is running a business and has to find a way to make additional money on its product… just like if you’re running the (newspaper) business and you increase your advertising rates,” argued Armond to the Business Observer.

“It’s strictly business, it’s our product,” added Armond.

Betting, Gaming and Lotteries Commission (BGLC) executive director Derek Peart said the BGLC, as industry regulators, does not intervene into commercial arrangements once they are in keeping with the Betting, Gaming and Lotteries Act.

“So, from the Commision’s standpoint, whatever arrangements are arrived at between CTL and the licensed bookmakers, we will not get involved in that aspect of it,” said Peart.

However, although the BGLC is aware of the proposed arrangement, Peart said the commission is still awaiting information it requested on the logistics of the new arrangements, particularly equipments and software to be used for connecting bookmakers to the tote so that they meet requirements for data transmission of sales and winnings. According to Peart, bookmakers upon entering into this arrangement with CTL will be required to be licensed also as Off Track Betting Parlour (OTB) operators and their premises entitled to have a maximum of 19 gaming machines.

“We have written a letter to ask what are the logistic arrangements…What is in place? You have the arrangement, so you have to be in a position to implement it,” said Peart.

Peart added that the commission has also asked for but has yet to receive a Rights Fee Agreement, which if absent will prohibit bookmakers from accepting wagers on local horse racing.

“There is a requirement for bookmakers to have a Rights Fee Agreement in place as a condition of their bookmakers permit, whether it will be local or overseas — in this particular case, it has to do with local racing,” he noted.

CTL operates 60-plus Off Track Betting Parlours (OTBs) compared to over 300 betting shops run by licensed bookmakers. Up to the end of September, bookmakers had sales totalling $1.3 billion while CTL OTBs collected $1.2 billion from local horse racing in 2010.