Busan Racecourse will not be allowed to admit customers from this weekend as the city has raised its social distancing level to 2 from this Friday. Under level 2, sports venues are allowed to admit 10% of their seated capacity, however, just as in Seoul which has been at this level since the start of the year, the racecourse and the two off-course betting centres in the city, must close their doors completely. No coronavirus outbreaks had been linked to the track or OCBs since they reopened at 20% of seated capacity in February. Customers may attend the Jeju pony races on Friday but the Seoul and Busan meetings on Saturday and Sunday at both tracks will be behind closed doors.
The blow is compounded by the fact Daejeon Off-Track-Betting Centre closed for the final time last Sunday after twenty-one years of operation. The long planned closure had first been announced in 2017 after political pressure. With all branches in the Greater Seoul area currently closed due to Covid-19 restrictions, it leaves only Jeju Racecourse along with the branches in Daegu, Cheonan and Gwangju open for betting.
Local media reported that in addition to the closure Daejeon authorities had requested that the KRA, which owns the twelve-storey building in the city’s Seo-gu district, donate it to the City in order to make amends for the supposed damage that the presence of an off-track betting centre had caused its people over the years. According to media reports, local politicians and residents associations say that the educational and residential environment in the district had deteriorated because of legal betting taking place.
The KRA declined the request, citing the financial crisis caused by the Covid-19 pandemic, and the building will now be put up for sale through the state-run Korea Asset Management Corporation. Prior to 2020, the site generated an estimated KRW 20 Billion in local taxes for the city of Daejeon annually.
One solution to this problem, which is repeating itself up and down the country wherever there is an off-track centre, would be the legalization of online betting. Representative Yoon Jae-gap, a Democratic Party National Assembly member initiated a bill last year to legalize the sale of betting tickets online. In publishing figures last week showing that the KRA made a KRW 438.1 Billion loss in 2020, Rep. Yoon said that he believed the “countdown to the collapse of the industry has begun” with emergency funds set to be exhausted by the middle of the year.
The Daily Hankook Newspaper reported an official at the Ministry of Agriculture, under whose jurisdiction the KRA and racing falls, as saying that the Ministry recognized that in the long term the legalization of online betting may be necessary but that it would be difficult in the absence of a national social consensus and that any legislation shouldn’t be rushed. The online sale of lottery tickets has been legal since 2018.
In semi-related news the saga of foreign punting groups apparently winning too much in the local Korean pools has come up again. The Chosun Ilbo reports that on March 30th, the Board of Audit and Inspection found that in 2019, the win rate of foreign customers was significantly higher than that of Korean nationals. The Board noted that 89% of betting tickets purchased by foreigners were issued in the final five minutes of betting compared to 74% of purchases by Korean customers.
This was, the report says, made possible by being able to get bets on in large volumes as late as possible (the maximum per ticket bet is 100,000 – US$88 – and it is difficult for Korean punters to get on more than that per race). Accordingly, foreign punters’ dividend rate on 2019 was 121% of their investment compared with 72% for Koreans.
The “foreigner only” off-track-betting location at Walker Hill in Seoul, where the majority of the betting analysed by the Board of Audit and Inspection took place, has been closed since the start of the pandemic and will not reopen with the lease expiring within the next month and notice having been given.