Permit row sees Betfair pull out of Greece

The group, which has not yet applied for a permit to operate in Greece, questioned the cost and conditions attached to permits required for gaming firms to trade in the country.

Betfair believes there are significant legal issues with a decision made by the Greek Gaming Commission that includes provisions for financial penalties against gaming operators that continue to operate in the market without a permit.

The company, whose exchange allows punters to set their own odds against one another, said before the decision to exit the market was made it expected to earn around £13m in revenues this year in Greece.

“According to legal advice received, the value of these permits is unclear and we consider the gambling legislation in the country to be inconsistent with European law,” Betfair said yester- day.

It added that it was disappointed the European Commission had not moved to prevent what Betfair calls “protectionist beha- viour”.

Betfair earlier this month withdrew its online sports betting exchange in Germany because of a tax levied on stakes on sports events from July 2012.

It was also hit by a decision made by Cyprus to introduce gaming legislation that restricts the products that operators can offer in the country.

Shares in Betfair fell nearly 2 per cent after the announcement.

Ivor Jones, analyst at brokers Numis Securities, slashed his underlying earnings forecast for the full financial year by £3m to £87m.

He said: “Betfair faces regulatory challenges and it may not have been marketed to its best advantage, but in our opinion it positions Betfair to continue to be a leader in online gambling.”

Betfair, which launched 12 years ago, said the value of permits introduced in Greece is unclear, while it considers the gambling legislation to be inconsistent with European law.

Furthermore, it said the associated fiscal conditions attached to the permits, which may include payment of taxes on historical revenues, make the market economically unattractive.

Betfair, which reports its half-year results on December 13, saw a 17 per cent hike in underlying profits to £85.7m in the year to April 30.

In the first quarter of the current financial year, it reported a 13 per cent hike in revenues to £91.6m.