High Volume Low Margin Incentive Program

Transcription

1 High Volume Low Margin Incentive Program 1 July 2014 to 31 December Background 1.1 Racing Victoria is responsible for the administration of Victorian thoroughbred racing. Racing Victoria's duties include ensuring that there is the fullest possible participation in Victorian racing. 1.2 Racing Victoria recognises that there is a segment of wagering customers who place a high volume of wagers but generate a low profit for wagering service providers "High Volume Low Margin" customers. Racing Victoria accepts that there are advantages for the promotion of Victorian racing in ensuring that these customers continue to wager on Victorian races. Racing Victoria also accepts that in the increasingly competitive and dynamic wagering market, some wagering service providers may restrict their offerings to HVLM Customers, with a potential risk of losing these customers to the unregulated offshore market. 1.3 In recognition of these factors, Racing Victoria has introduced the HVLM Incentive which it will trial for a period of six months on the terms set out in this policy. 2. Overview of HVLM Incentive. 2.1 The HVLM Incentive will be available to Approved WSPs, at the absolute discretion of Racing Victoria, upon application by an Approved WSP in respect of the periods: July 2014 to 30 September 2014 (the First Quarter); and October 2014 to 31 December 2014 (the Second Quarter). 2.2 Racing Victoria will assess the operation of HVLM Incentive at the end of the Second Quarter and will make an announcement whether it proposes to make the HVLM Incentive available beyond the Second Quarter. 2.3 If Racing Victoria determines that the HVLM Incentive is available to an Approved WSP, the amount of the HVLM Incentive calculated under this policy will, subject to this policy, be credited to the account of the Approved WSP and available to reduce the Fees payable by the Approved WSP under the Standard Conditions of Approval: in respect of the HVLM Incentive payable for the First Quarter, in relation to October 2014; and in respect of the HVLM Incentive payable for the Second Quarter, in relation to January The HVLM Incentive will not be made available to Approved WSP's by way of cash payment. 2.5 No Approved WSP has any right or entitlement to receive the HVLM Incentive. Racing Victoria may decide to grant or refuse the grant of the HVLM Incentive in its absolute discretion and without being obliged to give any reasons for its decision. Racing Victoria also reserves the right to terminate this policy or vary its terms at any time. [ : _1]

2 3. Applying for the HVLM Incentive 3.1 An Approved WSP wishing to apply for the HVLM Incentive may do so by completing and lodging with Racing Victoria a Quarterly Application: 1.3 in respect of the First Quarter, by 10 October 2014; and 1.4 in respect of the Second Quarter, by 10 January The Quarterly Application will be in the form required by Racing Victoria and will include the Quarterly HVLM Incentive Detail (attached to this policy as Annexure 1) and the Quarterly HVLM Incentive Assessment (attached to this policy as Annexure 2). The Approved WSP must provide all requested information. Racing Victoria will have the right to audit any information provided in any Quarterly Application, including individual HVLM Customer accounts. 3.3 Racing Victoria may delay crediting an Approved WSP's account with the HVLM Incentive whilst it completes its audit of the information that has been supplied by the Approved WSP. 4. Calculating the HVLM Incentive The HVLM Incentive will be the lesser of: 4.1 1% of the total Turnover of the Approved WSP from HVLM Customers in respect of Victorian Races during the Relevant Quarter; and 4.2 the amount calculated in accordance with the following formula: I TRF THC TAT where: I is the amount of the HVLM Incentive; TRF is the total amount of Fees paid by the Approved WSP in respect of the Relevant Quarter under the Standard Conditions of Approval; TAT is the total Assessable Turnover of the Approved WSP in respect of all Victorian Races during the Relevant Quarter calculated in accordance with the Standard Conditions of Approval; and THC is the aggregate of the Turnover of the Approved WSP from each HVLM Customer in respect of Victorian Races during the Relevant Quarter calculated in accordance with this policy. 5. Definitions In this policy: 5.1 words and expressions defined in the Standard Conditions of Approval will have the same meaning when used in this policy unless expressly defined in this policy; and [ : _1] page 2

3 5.2 the following words and expressions will have the following meanings: Bets Paid means, in respect of a Relevant Quarter: the aggregate of all moneys paid or credited to a HVLM Customer by an Approved WSP in respect of winning bets under Betting Transactions during the Relevant Quarter, including amounts paid to the HVLM Customer in relation to: (i) (ii) winning MultiEvent/MultiLeg Bets; and winning Free Bets; the aggregate of all Jackpots Created during the Relevant Quarter, but in paragraphs and, excluding: (c) (d) all amounts paid or credited to the HVLM Customer during the Relevant Quarter by way of, in connection with, or by way of economic equivalence to, commissions, rebates or incentives; and Pooling Fees, taxes, product fees, payments made to racing industry bodies or other costs of the Approved WSP. Bets Taken means the aggregate of all amounts paid or contracted to be paid to the Approved WSP under Betting Transactions placed by a HVLM Customer on Victorian Races at a Race Meeting other than amounts paid or contracted to be paid to the Approved WSP in relation to MultiEvent/MultiLeg Bets. For the avoidance of doubt, Bets Taken: (c) (d) includes all amounts paid, or contracted to be paid, by the HVLM Customer to the Approved WSP under Betting Transactions, regardless of whether those amounts are ultimately received by the Approved WSP; includes all Free Bets; and includes all amounts paid or contracted to be paid to the Approved WSP in relation to Betting Transactions involving two or more contingencies, all of which resulted at the Race Meeting; will not be adjusted to deduct any amount paid, refunded or credited to the HVLM Customer by the Approved WSP in relation to a nonwinning Bet Taken including, for example, "money back offers", but will be adjusted to reflect a refund of a validly cancelled Betting Transaction under any applicable Law. EPMB means, in respect of a Relevant Quarter, the aggregate of the following: the Eligible Portion of each MultiEvent/MultiLeg Bet placed by a HVLM Customer which resulted on a Victorian Race during the Relevant Quarter; and the Eligible Portion of each MultiEvent/MultiLeg Bet placed by a HVLM Customer where: (i) (ii) a Victorian Race during the Relevant Quarter (Relevant Race) was one of the contingencies forming part of the MultiEvent/MultiLeg Bet; and the MultiEvent/MultiLeg Bet resulted on an event (other than the Relevant Race) which occurs within the Relevant Quarter. [ : _1] page 3

4 First Quarter means the period commencing 1 July 2014 and ending 30 September Gross Profit means in respect of a Relevant Quarter, the amount calculated as follows: Gross Profit = Turnover Bets Paid Gross Profit Margin means, in relation to a HVLM Customer, the Gross Profit expressed as a percentage of the Turnover. HVLM Customer means, in relation to the Relevant Quarter, a Customer: (c) (d) who held an active account with the Approved WSP; whose identity has been verified in accordance with clause 8.1 of the Standard Conditions of Approval; whose Turnover with the Approved WSP on Victorian Races during the Relevant Quarter was $120,000 or more; and who generated a Gross Profit Margin for the Approved WSP of 4% or less for the Relevant Quarter. HVLM Incentive means the amount calculated in accordance with clause 4 of this policy. Net Customer Winnings means the net amount payable to HVLM Customer from all Betting Transactions on Victorian Races contracted by the HVLM Customer before any fees or charges are deducted by the Betting Exchange, provided that if, in relation to a particular Victorian Race, the "Net Customer Winnings" is a negative number, it will be deemed to be zero. Relevant Quarter means the First Quarter or the Second Quarter as relevant. Second Quarter means the period commencing 1 October 2014 and ending 31 December Standard Conditions of Approval means Racing Victoria's Publication and Use of Victorian Thoroughbred Race Fields: Standard Conditions of Approval in effect from time to time. Turnover means, in respect of a Relevant Quarter and in respect of a HVLM Customer: where the Approved WSP operates a Betting Exchange, the Net Customer Winnings for the Relevant Quarter; and for all other Approved WSPs, the amount calculated as follows: Turnover = Bets Taken + EPMB [ : _1] page 4

5 Annexure 1 Quarterly HVLM Incentive Detail Quarterly HVLM Incentive Detail Assessable Turnover Customer ID Bets Taken EPMB Total Assessable Turnover Bets Paid Gross Profit Margin (%) (Gross Profit / Turnover) Total Number of Bets taken [ : _1]

6 Annexure 2 Quarterly HVLM Incentive Assessment Racing Victoria Quarterly Race Fields HVLM Assessment WSP: Applicable Quarter: WSP A 1 July 30 September 2014 No. Detail Calculation Oct14 Nov14 Dec14 Total Quarter A1 All Customers Total Assessable Turnover (Parimutuel) $ A2 All Customers Total Assessable Turnover (Non Parimutuel) $ A3 All Customers Total Assessable Turnover Aggregated MulitEvent/MultiLeg Bets $ A Total All Customers Total Assessable Turnover [A1 + A2 + A3] $ $ $ $ B All Customers Total Race Fields Paid $ $ $ $ C All Customers Effective WSP Turnover Race Fields Rate [B / A] D1 HVLM Customers Total Assessable Turnover (Parimutuel) $ D2 HVLM Customers Total Assessable Turnover (Non Parimutuel) $ D3 HVLM Customers Total Assessable Turnover Aggregated MulitEvent/MultiLeg Bets $ D Total HVLM Customers Total Assessable Turnover [D1 + D2+ D3] $ E1 1% of HVLM Turnover for the Quarter [1% x D] $ E2 HVLM Incentive Calculation [(C 1.25%)*D] #VALUE! F HVLM Incentive (lesser of 1% of HVLM Turnover and calculated amount) MIN (E1, E2) $ [ : _1] page 6