Officials Discuss International Commingling

By Michele MacDonald
Officials representing virtually every major racing country around the world with pari-mutuel betting have taken the first step toward creating huge pools through international commingling that could revolutionize the sport.

Gathering in Paris in conjunction with the annual meeting of the International Federation of Horseracing Authorities, representatives from Japan, Hong Kong, Europe, the United States, Australia, and companies such as Magna Entertainment Corp. and Churchill Downs Inc. agreed to work on establishing a global framework of best practices for commingling. They planned to review the issues again in November after compiling a preliminary report and then to meet again in January during the Asian Racing Conference in Dubai.

"This has the potential to be the most exciting development in racing in a long time," said D.G. Van Clief Jr., a member of the IFHA executive council who in April announced his retirement as president of Breeders' Cup Ltd. and commissioner of the National Thoroughbred Racing Association.

"It's going to be a step-by-step, incremental process, but you will see markets opened up for racing," said Alan Marzelli, president of The Jockey Club and IFHA vice chairman in charge of commercial matters.

The potential of tremendous pools on premium caliber group/grade I races could be expected to stimulate fan interest in racing and generate more money for purses through increased handle fanned by the prospect of beneficial odds and lucrative payoffs.

Bertrand Belinguier, director general of France's Pari Mutuel Urbain betting system, led the ground-breaking private discussion on commingling and reported on the group's four major conclusions during the IFHA's open meeting on Monday. Officials determined that they would:

- Conduct a study of existing betting protocols and decide how to establish an international system;
- Analyze existing betting contracts with commingling;
- Examine the international calendar of exotic bets offered and consider forming one big multi-jurisdictional wager; and
- Establish guidelines and best practices regarding international policies on commingling for a worldwide system.

Obvious challenges to the concept include differences in betting rules from country to country, the necessity of foreign outlets adopting host betting standards, legal barriers between some nations, and development of a takeout system satisfactory to all. But the potential for growth that could be critical to racing's future outweighs the obstacles.

"This may be a chance for the horse racing industry to develop events with a worldwide audience and attractive betting products," Belinguier said. "As such, international commingling of pools represents a real asset for the pari-mutuel model."

He is optimistic that Japan, Hong Kong, and other Asian racing nations - which together generate more turnover than any other region of the world - will soften previously negative stances about participating with the U.S. and Europe on international wagering. However, he agreed with Marzelli that a desire for growth must be tempered by caution.

"We should aim at some real progress if we are not too ambitious," he said. "We might have limited objectives that we can be hopeful of achieving."

Louis Romanet, chairman of both the federation and France-Galop, pointed out that Sunday's Prix de l'Arc de Triomphe (Fr-I) offered a glimpse at the potential of international commingling. With about 7,000 Japanese fans in attendance at Longchamp to cheer for 2005 Japanese Horse of the Year Deep Impact, on-course wagering jumped up by 55% to establish a record.

If the Arc had been offered for betting around the world, including in Japan, handle might have grown exponentially while information about the race would have been distributed more widely, thus possibly cultivating additional racing fans -- and, eventually, more betting.

Romanet said the proper advanced technology and the creation of new bets will be critical in developing the most effective international commingling, which historically began in earnest in 1997 when the PMU offered wagering on the Breeders' Cup to French bettors, a relationship that has grown from an initial level of about $500,000 to about $3 million last year.