Who sets the price?

Corporate operators and their trading teams

What they are. Online wagering companies offering fixed-price wagering on racing and sport. Many of the brands Australians know are licensed in the Northern Territory, whose Racing and Wagering Commission publishes the current list of licensed sports operators and exchange operators. If you’re not sure a brand is licensed, that list is the place to check.

Who actually sets the number. A trading team. For racing, traders open a market, often the day before and earlier for feature races, by estimating each runner's chance and converting it into a price. For sport, much of the opening price comes from statistical models, with traders adjusting for team news, venue and weather.

How they get paid. Through the margin built into prices and by managing their book so no single result hurts too much. An operator is a risk manager first and a forecaster second. Its job isn’t to know who’ll win; it’s to keep a share of what’s bet across thousands of markets.

What that means for the price. A corporate operator’s price blends three things: its traders’ view, the money it has already taken, and what rivals and the exchange are showing. Heavily exposed on one runner, it will usually shorten that runner even if its traders’ opinion hasn’t changed.

Why limits differ between customers. Because operators carry the risk, each decides how much it will accept from each customer. Two people can be offered different maximum bets at the same price. That’s a commercial decision by the operator, not a rule of the market.

On-course operators

Stand in the on-course ring at Flemington, Randwick or Eagle Farm and you’ll still see operators with their boards. They hold permits through the racing system in their state and set their own prices, which can sit a few cents either side of the corporates.

Historically, the ring was the heart of Australian racing prices: the starting price was the price in the ring when the race began. Today the corporates and the exchange hold far more money, so most price discovery happens online. Racing bodies still treat on-course operators as a distinct group. When Racing Victoria reset its race fields fees from 01/10/2024, it set a separate 0.5% rate for on-course operator activity, according to industry reporting at the time.

The organisations that shape prices without setting them

This is the part of the market most punters never see. These three groups don’t publish a single price, but every operator builds their charges into the numbers you’re offered.

Racing bodies: race fields fees

Each state's principal racing authority, such as Racing Victoria or Racing NSW, controls racing in that state. Under state "race fields" laws, a wagering operator needs the authority's approval to offer bets on that state's races, and the approval usually comes with a fee.

An exchange operator challenged the NSW arrangements, arguing they discriminated against interstate operators. In [2012] HCA 12, decided on 30/03/2012, the High Court dismissed the appeal and upheld the fee conditions.

The fee formula is set by each authority and changes over time. Racing Victoria’s race fields policy sets out how it assesses applications; its fee calculation sits in separate standard conditions of approval, currently effective from 01/03/2025. From 01/10/2024 Racing Victoria moved to a single-rate monthly calculation across all meetings and stopped charging fees on free-bet turnover, as reported at the time.

Sports: product fees and integrity agreements

In Victoria, a wagering provider can only offer markets on a sporting event if it has a Product Fee and Integrity Agreement (PFIA) with the approved sports controlling body, for example the AFL. Offering a market without one breaches section 4.5.22 of the Gambling Regulation Act 2003 (Vic). The Victorian Gambling and Casino Control Commission (VGCCC) approves sports controlling bodies and wagering events, can ban specific bet types, and decides disputes where a sport unreasonably refuses an agreement. The fee goes to the sport; the integrity side gives the sport access to wagering data.

State governments: point of consumption tax

Every state and territory except the Northern Territory taxes wagering operators on revenue from bets placed by its residents. Rates are set by each state:

Industry analysis of 2025/26 data puts South Australia, Western Australia and Tasmania at 15% (with lower tax-free thresholds) and the ACT at 25%, and estimated total POCT collections that year at $1.27 billion, with more than $615 million passed on to the racing codes.

Quick reference