Betfair Pty Ltd v Western Australia

The High Court of Australia considered the validity of provisions of Western Australia's *Betting Control Act 1954* (WA) in *Betfair Pty Ltd v Western Australia*. The plaintiffs, Betfair Pty Ltd, a licensed betting exchange operator in Tasmania, and a second plaintiff who used Betfair's services to bet on Western Australian races, challenged sections 24(1aa) and 27D(1) of the WA Act. These sections criminalised betting through a betting exchange and the unauthorised publication of Western Australian race fields, respectively.

The central legal issue before the High Court was whether these provisions of the WA Act were invalid by reason of section 92 of the Australian Constitution, which guarantees freedom of interstate trade, commerce, and intercourse. Specifically, the Court had to determine if the impugned sections imposed an impermissible disadvantage on interstate operators like Betfair compared to Western Australian wagering operators, and if they impermissibly restricted competition in the national market for betting services. The Court also considered the historical context and evolving interpretation of section 92, including its role in creating national markets and eliminating protectionism.

The Court reasoned that section 92 of the Constitution is intended to create national markets and prevent protectionist measures that discriminate against interstate trade. Drawing on historical understanding and contemporary legal principles, the Court applied a criterion of whether the legislation, in its practical effect, imposed a discriminatory burden on interstate commerce that was not justified by reasonable necessity or proportionality. The Court noted that while state legislatures have power to enact laws for the well-being of their citizens, this power is limited when it unduly restricts interstate trade. The Court found that the challenged provisions, by their operation, created barriers to interstate betting and the dissemination of race fields, thereby infringing the freedom guaranteed by section 92.

The High Court answered the questions reserved in the amended special case. It held that section 24(1aa) of the *Betting Control Act 1954* (WA) was invalid to the extent that it applied to a person making or accepting offers to bet through Betfair's betting exchange via telephone or internet communication between Western Australia and Tasmania. Similarly, section 27D(1) of the WA Act was found to be invalid to the extent that it applied to Betfair publishing or making available a Western Australian race field via telephone or internet communication between Tasmania and another state, or for the purpose of facilitating betting exchange operations between Tasmania and another state. The Court ordered that the costs of the plaintiffs in the special case be borne by the defendant.