HORSE RACES SA LETTER

TO:

Minister of Culture and Sports

Andrea Papandreou 37, 151 80 Marousi

PUBLISED:

• CEO of Hellenic Republic Asset Development Fund
• Jockey Club

Athens, 13/4/18

Prot. N .: HRGP18001877

Honorable Mr. Minister,

1. From the day of the election of the new President of the Jockey Club (FEE) Board of Directors as a member of the body, and even before the official appointment of the new Management, HORSE RACES SA, an OPAP Group subsidiary, was put in the extremely unpleasant position of fighting, almost daily, not only for the revival of Greek horseracing, but also for the implementation of Greek Law and the prevalence of common (racing) sense, the internationally applicable and ultimately self-evident.

2. The messages had already been put out in the past. The President of the BoD himself had ahead of the privatization talked about the immediate intervention of the constant members of the FEE General Assembly, in order to avoid developments that would place the very existence of horseracing and breeding activity in Greece at risk; and a current member of the body had spoken of the incompatibility of the provisions of the 24/4/2015 concession agreement with which HORSE RACES SA acquired the exclusive right to organize and conduct mutual horserace betting, and the sanctioning law of the agreement on national/constitutional level and also European level, which constitute an asymmetrical threat to the horseracing community as a whole. We even became recipients of opinions about the operation of FEE following the awarding of horserace betting to the private Horse Racing organization as a public institutional counterweight, which would offset the betting activity in market terms and balance the wider horseracing market. Even on IFHA's website regarding Greece, we were surprised to find that, although the data for the year 2016 were updated, it notes that there are two Horse Racing bodies in Greece.

3. The problems which HORSE RACES SA faced from the very start of the privatization [era] were many and extremely serious. Horseracing had come to the verge of complete destruction, with the rapid and continuous decline of horses and horse owners since 2010. However, it was ultimately made possible – with great struggle and financial cost for HORSE RACES SA – to finally provide fresh impetus and prospect towards the revival of Greek horseracing. So, among other things, despite the fact that HORSE RACES SA was not contractually obligated to conduct horseraces in the first two years since the concession, we immediately proceeded with to organize and conduct them, we brought horses from abroad and provided the financial facilities to prospective owners to buy horses, and we doubled the value of prizes compared to what was provided by the concession agreement.

4. As part of the effort to revive Greek horseracing, and to simultaneously comply with the obligations imposed by Greek Law (article 85 par. 1 of Law 4172/2013), under the previous FEE management, it was ultimately made possible, after a lengthy process, to arrive at a draft Racing Code on which there was a convergence of views by both FEE and HORSE RACES SA competently appointed committees, with the only exception being the Introduction to the relevant document.

5. Following the election of the new FEE BoD and in spite of the publicly expressed position of its President in favor of “conducting a final round of consultation between the Code Committee of the Operator and horseracing classes, in order to complete the drafting of the Racing Code and subsequently forward it to the General Assembly of FEE for approval as soon as possible”, we naturally took swift care to make sure this is achieved, [but] were faced with a new, nearly insurmountable impediment. The FEE Committee (which didn’t include the three member s of the previous Committee – who also sat on the last BoD of FEE) members did not set the plan we had almost 1 year ago mutually agreed upon as a basis for the relevant consultation, but another, largely different plan, which had been previously drafted, and which, in addition to lacking in the legal sense, its imperfections, uncertainties, ambiguities, repetitions, redundancies, shortcomings and contradictions, was characterized for:

• Breaching the principle of legality and non-breach of legislative authorization. As it is known, the delegated legislator (of the Racing Code) cannot dispense with the current legislative authorization, [stemming from] article 85 of Law 4172/2013, which is extremely limited. Specifically, its content is to provide at least the procedure and rules for the conduct of races, the positions and duties of the minimum number of Technical Assistants provided for, as well as the criteria and procedure for the selection and assignment of their duties, the appeals procedure, the process and conditions for the acquisition or loss of the status of owner, trainer and jockey of racing horses, the disciplinary law governing those involved in conducting horseraces and the process for doping control in accordance with the relevant regulations of the International Federation of Horse Racing Authorities. And the term “minimum” is not to mean that the abovementioned legislative authorization included other matters too, other than those expressly referred to therein, inasmuch as according to Article 43 (2) of the Constitution the legislative authorization must be specific and clearly specifies the issues to be regulated. Therefore, other issues, apart from those explicitly mentioned in the enabling provision, cannot be regulated by the new Racing Code. With this very change, the executive and legislative authorities sought to protect the new entrant in the horse racing sector (the Horseracing Operator) from the damage it would incur from the limitless and unconditional amendment of the institutional framework which applied at the time of the concession, and on which, inter alia, it based its decision to proceed with the investment in question.
• Failure to comply with the fact that the role of FEE, following Law 4172/2013 (article 86 par. 2), is exclusively to control, supervise and ratify and that the organization and conducting of horseraces belongs to the Horse Racing Operator; also, in accordance with the principle of legality, FEE can only exercise the powers conferred on it by law, and always within its limits.
• Its opposition to the provisions of articles 83 and the ensuing [articles] of Law 4172/2013, as well as the inclusion of provisions that were explicitly abolished by the latest law.
• Its almost universal opposition to international standards in developed horse racing countries such as the United Kingdom and France.

6. Despite this, and despite the apparent violation on behalf of FEE of the principle of the continuity of the functioning of administrative services (note: the changes of management in JC does not constitute a reason for the change of the draft Horse Racing Code that had been agreed), we did not abandon the relevant process of “consultation, as we wanted to prevent as many adverse consequences as possible. However, it was all in vain, as can be seen via a simple overview of the new Plan, which was sent to us on 11/4/2018, without the consultation or the plan itself having been completed (indicatively, the chapter on Penalties is missing completely), while it retains many of the deficiencies, omissions and shortcomings that were set out above (see paragraph 5 above).

7. The same draft was subsequently included as a topic (no. 3) on the agenda of a FEE BoD meeting scheduled for 13/4/2018, in order for its members to “be briefed and decide on it being submitted to the General Assembly of FEE”. That is, within two day, the members of the FEE BoD will examine a 183-page document and will then proceed to discuss it, possibly propose amendments and submit comments.

8. For the sake of simply pointing out the lack of legal (and horseracing) adequacy of the abovementioned plan, we mention:

a) The draft’s provision of paragraph 5 of the of the article concerning the Horseracing Program, with which current legislation of Law 4172/2013 (article 83, par.1) on the obligation of the Horse Racing Organization to determine the racing program per quarter, which becomes “exceptional”.

Any provision that is different to that stipulated by Law (article 85 par. 1 of Law 4172/2013) cannot be inserted in the Racing Code, because, as broadly as its authorizing provision may be perceived, the Code cannot amend provisions of the enabling law, in the absence of specific legislative provision allowing it to do so.

From the abovementioned “regulation” alone, [which is] in breach of the legislative authorization granted by Law 4172/2013 (article 85) to the competent Minister of Culture and Sports, it is clear that, in addition to the apparent lack of legal integrity of the new Racing Code, the “authoritarian” perception of the authors make them place FEE above the Hellenic Parliament, the Constitution and the Law.

b) The removal from the new Code draft of the article 50 provision (paragraph a, case c) of the current Code, which – in the context of the principle of impartiality of public service bodies in the performance of their duties and the enhancement of the credibility of horse races, as well as to deal with possible phenomena of conflict of interest or the same person being the controller and the controlled at the same time - limits FEE veterinarians exclusively to control issues, as they have no involvement in the care of horses. In this way, if of course this is ultimately approved, a FEE veterinarian will be allowed in future to receive payment for the provision of horse care, with all the adverse consequences this carries in terms of the performance of their duties as civil servants, and, more importantly, in terms of preserving the integrity and credibility of the Jockey Club itself, as the capacities of the controller and the controlled will be confused. This will allow a FEE veterinarian being paid to care for the horses of a trainer/owner, and at the same time controlling the latter with relation to racing issues, i.e. scratching his horse at any time following registration with his own opinion, and overseeing doping control of his client’s horses (or the horses they compete against) and deciding to carry out such controls or not.  

9. Before (the “consultation” of the new Code draft) and in the meantime, a number of violations of laws 4172/2013 and 4338/2015 were observed, as well as of the principle of legality on behalf of FEE, for most of which we complained in writing and strongly; you know of these as the correspondence has been notified to you. In summary:

a) The Deputy General Manager of FEE initially attempted, with his letters on 18/9/2017, 22/9/2017 and 27/9/2017, to put a special terms race (4+ ST MAIDEN) of the Horseracing Operator’s General Program of horseraces under the approval of FEE, in violation of par. 1 article 83 of Law 4172/2013. The attempt was finally concluded by the author of a suggestion, titled “Approval of Horseraces included in the official program of the 4^th quarter of 2017”, for an off the agenda discussion, during a FEE Board meeting on 6/10/2017.

b) It was decided, by the FEE Horseracing Committee decision on 5/12/2017 - without even previously inviting the Horseracing Operator to express its views – to reject the conducting of the legitimate and competently proclaimed by the Horseracing Operator additional supplementary race (4+ ST MAIDEN at 1,300 meters). The decision overturned what has been consistently valid at the Racing Track and violated the principle of the legitimate expectations of the governed towards the State, the principle of the hearing out of those governed, and the principle of legality; it was also based on the misinterpretation of the applicable provisions of the law, and especially those in articles 83, 86 and 87 of Law 4172/2013 and article 3 of the Concession Agreement ratified via Law 4338/2015, bringing about the alteration of the legal program of Greek horseraces, for which reasons we were forced not to carry out the horseracing meeting scheduled for Friday 8/12/2017.

c) During the horseracing meeting of Friday 30/3/2018, serious problems with a very negative impact on HORSE RACES SA and the smooth organization and conduct of horse races mutual betting on these, were caused due to the handlings of FEE officials who implement, in their area of responsibility, supervision and control on behalf of FEE of technical racing issues (approval by stewards of the replacement of jockeys was delayed, along with the announcement of the reviews of the 5^th and 7^th race).

d) Measures were not taken or proposed to enhance the credibility of horse races as well as to address potential conflicts of interest or the same person being both controller and controlled simultaneously. Such phenomena lead to horse owners and fans turning their backs to horseracing, the huge reduction so the number of horses and the collapse of horserace betting. Similarly, when a FEE member is also a horse owner (or breeder), or an official or veterinarian of FEE is also a paid vet for the stable of an owner whose horses race at the racing track; also in view of the fact that persons responsible for carrying out the statutory technical supervision of horseraces and also apply the penalties provided for by the Racing Code, are appointed by the FEE BoD. This body, among other things, deals with appeals and imposes the penalties provided for by article 3 of the existing Racing Code, or it increases, reduces, validates, suspends or cancels them as case may be.

e) Statements – that were not denied – were published online, which appear to have been made by the President of the FEE BoD, and which – provided that they are true and have been properly quoted – are incompatible with his institutional capacity. These regard the lack of a published 5-year business plan by HORSE RACES SA, which FEE is in fact ready to prepare; that HORSE RACES SA spends a lot of money on the salaries of employees and events, funds that if given to FEE to manage it would ensure that 1,000 horses would be in Markopoulo within two years; that FEE is ready to take over the operational part of horseracing and that if one were to manage of the HORSE RACES SA budget, in two years turnover would increase and horses at the track would rise from 300 to 1,000. Such statements do not meet the requirements of the institutional role of FEE’s President, while FEE appears to be seeking for a co-management, with the funds of HORSE RACES SA.

10. Honorable Mr. Minister, we repeat that the activity of FEE, which as a public law legal entity falls under public administration, must be government by the principles:

• Of the continuity of the operation of public administration bodies
• Of the hearing of the governed
• Of the legitimate expectations of the governed towards the State
• Of the impartiality of public administration bodies in the performance of their duties
• Of legality, which reflects the principle of the rule of law

This means that FEE ought to comply with the requirements of the law and move within its confines, that it cannot act (by means of administrative acts, contracts or material actions) unless this is imposed on it or permitted by law, and not when it is not forbidden. That it ought to show respect the rule that “what is not expressly imposed on it or is not permitted, is forbidden”. That its competence is confined to the matters that the law explicitly provides, is not inferred, presumed or extended.

11. Honorable Minister, we denounce any attempt that effectively negates the organizing of Greek horseraces, falsifies their future and leads to the failure of the privatization of horseracing with mathematical accuracy, at the expense of HORSE RACES SA, as well as the many members of the horseracing community, and we call on you to your statutory powers of oversight of the Jockey Club and the issuing of a Racing Code, pursuant to the authorization of Article 85 of Law 4172/2013:

• Which will be in accordance with the letter and the spirit of the (empowering) law (L. 4172/2013) and the generally applicable institutional framework;
• Which will implement and be covered by the abovementioned (10) priniciples, which should govern the actions of FEE as a legal entity governed by public law;
• Which will respect and safeguard the legal rights of all the members of the horseracing community;
• Which will not overturn, but rather respect and secure both the fundamental facts on which the significant investment of the Horseracing Operator was based, as well as the 24/4/2015 Concession Agreement, which was ratified by Law 4338/2015;
• Which will not hinder the successful outcome of the effort to revive Greek horseracing;
• Which will be fully harmonized with the international racing practice and the corresponding Codes of countries where the sport of horseracing is advanced.

12. Finally, we regret to note that if these practices continue from the Jockey Club, this will result in the degradation and ultimately the end of Greek horse races.

CHAIRMAN OF BOARD OF DIRECTORS OF HELLAS HORSE RACES S.A

DAMIAN COPE