BHA update on ownership syndicate changes and Racing Digital
The BHA has just released its latest blog on the subject of syndicate and club changes alongside the Racing Digital development work.
As part of an enhanced BHA Racing Digital platform for owners, due to be completed in the first half of next year, the definition and administration of different syndicate and clubs will become clearer and the percentage share owned by each member in those syndicates will be transparent.
In addition there will be enhanced due diligence relating to syndicate and club managers across those currently registered and also those wanting to be registered as syndicate and club managers in the future.
These are positive steps being taken in order to support the rapid growth that has been seen across Shared Ownership. The BHA blog can be accessed here and is also copied below.
The growth of shared ownership is crucial to support the future of British racing. It is, therefore, vital to ensure that in designing Racing Digital the new platform not only supports syndicators by simplifying administration, but also protects against regulatory risks associated with the increased number of syndicates.
Central to these improvements is simplifying the definition of what a syndicate is and does, and introducing a new requirement to record members’ percentage shares to allow for an increased visibility and understanding of their ownership interest.
In addition, we will also introduce a brand-new licence for syndicators and club managers, aimed at bolstering the regulation of syndicates and racing clubs. More information on this is provided below.
SYNDICATE DEFINTION
Following significant feedback from syndicators and members alike, the BHA will be simplifying its definition of syndicates to provide greater clarity for anyone registering or joining a syndicate.
From spring 2024 when Racing Digital will be launched for owners, the syndicate registration will be reserved for more commercial entities and syndicates will be defined as:
A form of shared ownership where the Members own, or lease, an interest in racehorses and the Syndicator receives remuneration for their role and/or the method of attracting participation in the entity includes invitations to the public.
Alongside this racing clubs will continue to be defined as:
An entertainment associated with racehorses, where the Members acquire no ownership rights to, or lease an interest in, any racehorses but may acquire certain benefits such as the sharing of prize money.
To allow for this change. some important improvements have been made to the way that partnerships (a form of shared ownership primarily aimed at family and friends who come together to own or lease racehorses) will operate in Racing Digital making them much more accessible. These include:
- Allowing partnerships to join other partnerships to form a new ownership group for the first time;
- Significantly reducing the cost of registering a new partnership; and,
- Allowing all individuals to register as owners free of charge.
All syndicates will be contacted directly with more details about these changes and to explain how their ownership type can be changed free of charge if required.
SYNDICATE MEMBER SHARES
To increase members’ visibility of their ownership interests and promote transparency around the selling of shares, syndicators will be required to declare the percentage shares of horses owned by their members.
Syndicators will be able to upload and update members’ details and their shares at any point during the life of the syndicate and will either be able to add members one by one, or through a bulk upload – simplifying the administration process.
More information will be sent directly to syndicators in advance of launch including specifics relating to the lead time provided to ensure all necessary information is uploaded before syndicate members are given access to the Racing Digital system to view their own shares in horses.
SYNDICATOR AND CLUB MANAGER LICENCES
To help the BHA proactively regulate shared ownership, in mid-2024 a new licence will be introduced for anyone wishing to manage a syndicate or racing club.
The licence, which follows significant feedback from across the industry, seeks to help bolster consumer confidence in shared ownership. This will allow the BHA to better evaluate all syndicators and racing club managers to ensure they are able to meet the requirements placed on them by the Rules of Racing, the sport and their members.
This will include assessing business competence and an understanding of how to properly advertise and promote shared ownership, all while ensuring they have the financial resource available to remain sustainable.
A licence will be required by both new and existing syndicators and racing club managers, and more information will be communicated directly in early 2024 around when this will be introduced and how to apply.
MORE INFORMATION
More detail will be provided ahead of implementation, however, if owners, syndicators or club managers have any questions on the changes, they can email [email protected].