The quantum of royalty to be paid to Royal Western India Turf Club by the Bangalore Turf Club has become a contentious issue, with the reciprocal arrangement on the brink of collapse. If the stalemate continues, it could prove detrimental to the edifice of the sport and ruin it in the long run.

The Bangalore Turf Club has offered to pay Rs 2.85 crores as royalty to RWITC for conducting off-course betting on the races held at Mumbai and Pune, increasing it from the existing Rs 1.70 crores. However, RWITC mandarins have not agreed to this sum and have informed that they may cut off the signals for BTC from the ensuing Pune season, scheduled to start on Thursday, July 28 if the amount offered does not meet their expectation.

The negotiations thus far between the two clubs have remained inconclusive. Both the Clubs have persisted with their rigid stands, with no sight of any amicable settlement. RWITC has reiterated the need to adhere to the age old terms of payment of royalty, involving remittance of royalty to the host centre, restricted to 23% of the net commission earned at the Totalisators and bookmakers at the centre conducting off-course betting. BTC has however contended that the age-old formula has no relevance and that royalty should be compounded, as otherwise, its coffers would be drained to the benefits of other Race Clubs.

This impasse is not new and a similar situation had erupted during the year 2002, when all the former Chairmen of BTC had rallied around the Club and a settlement was reached, wherein payment of royalty was compounded. The club had also organised an informal meeting of the members to enlist their support for their stand. Unfortunately, this time, no such meeting has taken place and the BTC Committee has taken upon itself to take a critical decision without bothering to obtain the majority view from members. Unfortunately, this year, leadership is singularly lacking with decisions taken to suit individual interests without taking all stakeholders into confidence. Involving senior members of both clubs to hammer out a solution before any drastic decision is taken, is of critical importance to the sport.

BTC had then strongly argued that any proposal beyond the parameters of the arrangement of compounding royalty was not equitable, as otherwise, the quantum of monies remitted by BTC on Mumbai/Pune Races would be far beyond the amount actually earned by RWITC on its own races. In this background, the logical argument has not been rebutted till date, especially as the fruits of innovation at the Totalisators, by BTC cannot be frittered away to the financial advantage of other Race Clubs and to its own detriment.

Notwithstanding the contrary positions taken by both the Clubs, the time is now not appropriate for a collision course, especially as the entire format of payment of royalty would perhaps undergo a drastic change with the onset of Goods and Services Tax from the ensuing financial year. Both the Clubs would do well to arrive at an ad-hoc arrangement for the current financial year, as neither of the patrons at Bangalore and Mumbai/Pune would wish to lose out on the splendour associated with racing both at Bangalore and Mumbai/Pune. A compromise indeed would be the best solution in the interest of racing in the country.

On the larger aspect, all the Race Clubs would, in fact, do well if they jointly address concerns arising out of the impact of GST and explore the possibility of organizing common Totalisators Betting on a national level, especially with computer technology having been upgraded at all Racing Centres to facilitate this integration. The past should be buried and all the Race Clubs should look ahead. Neither BTC nor RWITC could afford to snap ties, in view of their long-standing financial relationship over five decades, following the introduction of off-course betting at Bangalore on Mumbai Races during the year 1977, which changed the entire financial dimension of conducting horse racing.

With a final decision expected to be taken on this matter on Tuesday, July 26, racing patrons would be hoping that better sense would prevail at both the Race Clubs.