PMU fined after failing to split online and retail liquidity

8 April 2020

French horse racing giant Pari-Mutuel Urbain (PMU) has been hit with a €900,000 (£727,886/€827,561) fine from France’s Competition Authority after it was found to have failed to maintain its commitment to splitting online and retail liquidity.

While the operator has upheld the commitment first made in 2013 - then mandated by the Authority in February the following year - to keep betting pools for each channel separate for domestic racing, it has maintained shared pools for international racing.

This prompted complaints from Betclic Everest Group’s Betclic brand and Zeturf, which argued that PMU was flouting the February 2014 agreement.

PMU has commingling agreements in place to offer coverage of South African, Irish, American, Norwegian and Swedish racing. Betclic and Zeturf noted that these are currently offered with identical odds and prize pools on its website and in retail outlets.

The combined online and offline pools are then combined with those of its foreign partners to offer a single, large jackpot under the terms of these commingling agreements.

“Therefore, within the framework of these partnerships, PMU is able to offer betting on foreign racing on its website and in its retail network on equally attractive terms,” the Competition Authority explained. “[This] corresponds directly with the situation for [French] horse race betting, before it committed to [splitting online and offline liquidity] in 2014.”

The Authority, however, said that the order in 2014 to split online and retail liquidity was “unambiguous”, and covered all racing, rather than just domestic events.

This 2014 ruling stated that by combining its online and retail pools - following a complaint from Betclic - PMU had an unfair advantage over other operators offering horse racing pools. The decision to split the pools was therefore taken to ensure consumers were offered a diversified range of betting options.

France’s igaming regulator, L’Autorité de régulation des jeux en ligne (ARJEL) supported this assessment, while PMU was also warned that pooling liquidity may not be factored into any commingling agreements.

Indeed, the Authority added, PMU had drafted the commitment itself, meaning there was no possible way that it could have been permissible to having a separate set of rules for betting on foreign racing.

“Even if, at this time, commingled foreign racing pools only constitute a small part of PMU’s horse racing betting revenue, the breach is all the more serious since the commitment to split liquidity was a key component of the arrangement to prevent the operator’s PMU.fr site from benefiting from its retail monopoly,” it explained.

The dispute between PMU, the undisputed horse race betting market leader in France, and challengers such as Betclic and Zeturf stretches back to the opening of the country's regulated igaming market in 2010. As well as forcing the operator to split its online and retail pools, this has also seen the French courts order PMU to pay Betclic Everest an unspecified sum in compensation for anti-competitive practices.