Racing: Upheaval certain as Turf is pushed towards a new era

Fair Trading Report: Existing structures of the sport are deemed anti-competitive and face being swept away after Whitehall investigation

A new era for horseracing in Britain, deregulated at the impartial hands of the Office of Fair Trading, with the British Horseracing Board denuded of its most important powers, looms. The OFT's long-awaited report, published yesterday, has the capacity to free racing from the shackles of an over-bearing executive or throw the sport into chaos.

Picture a scene, potentially as soon as next year, when racegoers could have the choice between attending an afternoon's racing at Ascot or go down the road for Windsor's 12-race card, before moving on for the final night of Sandown's six-day meeting. The prize-money for owners might not be up to much – and lord knows how it might be generated once the data-rights deal becomes worthless – but the course facilities would be well funded. Some tracks would have given up on badly attended jumps cards but plans for their new all-weather courses would be well under way, their only fear being the competition from the half-dozen new courses poised to enter the market.

That is just about the most startling scenario that the OFT's intervention in the long-established regulation of racing, passed down from the Jockey Club to the BHB a decade ago, could bring. Potentially, the OFT could be persuaded by racing's rulers that after two and a half years of investigation they have come to the wrong conclusion, particularly if the BHB can bury the hatchet with the Racecourse Association, but you would not want to bet on it.

It has been the confrontational stance of the BHB under their current chairman, Peter Savill, with the racecourse and with the bookmakers that has helped bring about the OFT's investigation. Indeed, it was the BHB itself that asked the OFT in June 2000 to consider its rules and regulations so that it could be sure that it was operating within competition law.

That move could have paved the way to ensuring that the BHB's controversial pricing of fees from bookmakers for data rights was built on solid ground, instead the rug has been moved from under their feet. "The data-rights agreement, worth £100m a year, is the bedrock of the future funding of racing post-Levy," Alan Delmonte, the board's spokesman, said yesterday. "We now have some months to respond to the OFT's views and it may be necessary to go back to them with some changes. We're not opposed to changes but they must benefit the [racing] industry as a whole."

That initial inquiry has escalated into the most significant investigation ever mounted into racing's right and ability to charge for the use of its "product". Fanning the flames was a complaint from William Hill, under its equally combative chairman, John Brown, that the BHB was abusing a dominant position as the sole provider of race data on British racing. William Hill alleged that this had enabled the BHB to set excessive and discriminatory pricing and restrictive licensing terms.

The OFT's report warns the sport's rulers that they are breaking competition laws in the key areas of the fixture list and provision of race data. The response of the BHB's chief executive, Greg Nichols, is that "the OFT has fundamentally misunderstood how and why British racing operates as it does".

Unsurprisingly, the Racecourse Association, chief beneficiary of the report, welcomed its publication but its chief executive, Keith Brown, another who has been prepared to match Savill blow for blow, said that "courses have no interest in taking over the running of racing, but we need a greater involvement in industry decisions".

"We would like greater co-operation rather than the dictatorial attitude that prevails at the moment," added Brown, who now has a powerful tool with which to gain leverage in his dealings with Savill.

In truth, common sense is likely to prevent the racecourses from abusing the freedoms that the OFT suggests. The report says that the board's control is stopping tracks responding to consumer demand; preventing them racing more often, stifling their expansion and restricting the entry of new tracks.

It claims that the BHB distorts the balance between racing codes, "between National Hunt racing, Flat and all-weather racing, independent of actual customer demand".

It also says that the practice of preventing meeting's taking place at courses located within 50 miles of each other, infringes the Competition Act and that courses are being prevented from increasing the number of races on a card."

The Racehorse Owners' Association president, Jim Furlong, said: "There are big implications [in the report]. If there was a big expansion of all-weather racing what will happen to the National Hunt population? If everybody decides to run competing races on the same day that is going to be a nonsense. There are far-reaching changes coming and it is going to be an exciting time, but it will have to be handled carefully."

THE OFT'S CHIEF FINDINGS

The OFT has said that some of the BHB rules and regulations infringe the 1998 Competition Act by:

* Limiting the freedom of racecourses to organise their racing, in particular by fixing how often and at what times they stage races and the type of racing they stage

* Fixing the amounts racecourses must offer owners to enter their horses in a race

* Monopolising the supply of race and runners data to bookmakers by foreclosing competition from alternative suppliers