Welcome to Racehorse Ownership - Racing NSW


Please browse through the information and guidelines below if you interested in becoming a Racing NSW racehorse owner. We have included information on the industry and its partners and have all the contacts to get you started with a racehorse. For existing or past owners, the guide will highlight new initiatives and structures and clarify some of the procedures.


We would love to hear from you. We currently require feedback regarding the type of ownership you are interested in. Budget? Trainer? Location? Ownership structure? We will then be able to co-ordinate your requests and get everyone involved and enjoying racing.









KEY BENEFITS:STARTING POINTS:THE NEXT STEPS:



 




KEY BENEFITS:




PRIZE MONEY
The biggest benefit of direct racehorse ownership is obviously prize money, bonuses and trophies earned by your horse.

One Saturday Metropolitan win can cover your training costs for a year or more.



  • Owners are entitled to the horses earnings pro-rata to their ownership percentage
  • Prize money earnings are tax-free if ownership remains a hobby
  • There is a 10% deduction for the trainer and a 5% deduction for the jockey
  • There may be a 2-5% deduction for the stable (i.e. foreman, track work riders)
  • Prize money is paid twice a month directly into owners’ bank accounts by Racing NSW
  • Typical example of Saturday prize money in NSW as of 01/08/09:




 


BOBS



The BOBS scheme provides ADDITIONAL prize money to owners for horses raced in NSW.




BOBS is the Breeders Owners Bonus Scheme operating in NSW. Progeny of stallions standing in NSW are eligible for the scheme and a fee must be paid by the current owner by 1st September to enter each 2yo horse in the scheme. The bonus is available for winners only of most races in NSW, with the exception of Group and Listed races.

BOBS bonus is currently paid to owners as follows:



BOBS EXTRA

Bobs Extra is a recent initiative to support owners who have greater expenses when they race older staying types of four years and over. Horses entered into the Bobs Extra scheme, for an additional fee, will collect BOBS prize money, as tabled above, as 4yo’s onwards for races over 1600m and further.






BOBS - DOUBLE UP
There is also an option to DOUBLE UP into a voucher to be used to purchase another horse (unraced & BOBS eligible) sold via an auction. Each owner can choose whether to take the cash or double up separately.



Refer to the link below to Racing NSW BOBS section for more details:
http://www.racingnsw.com.au/default.aspx?s=bobs


 


TROPHIES
You may be lucky enough to collect a trophy when your horse wins a race, typically the race would be worth a $100,000 or more. The trophy may be a traditional cup or bowl, horse and jockey or a mounted photo style dvd.

For multiple owners, the options include sharing, ordering replicas or auctioning the trophy to the highest bidding owner.

The majority of metropolitan and provincial race clubs will present the minimum of a winning sash and dvd record of the winning race for all the races they hold.

The individual race clubs will provide details on the suppliers of the trophies for multiple orders.

 


TICKETS
There is no extra cost for a fun day out when your horse races. All owners receive members tickets and entry to the parade ring when their horse is racing.

Typically the race club involved will offer 2 tickets per owner up to ten owners, and 1 ticket per owner up to twenty owners and you will be able to utilise members facilities on the day.

Prior to your horse racing, you can inspect the horses up close in the parade ring and discuss race tactics and chances with your trainer and jockey.

Note: You will need to check with the individual race clubs prior to the race as ticket policies are flexible.

And of course if your horse wins, you will participate in the sash or trophy presentation, photos and collect the winning dvd of the race. Have your speech ready!



JOCKEY SILKS

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Design your own jockey silks! The jockey wears the colours provided by the trainer, or the managing owner or the syndicate. You can create your own unique colours and register them with Racing NSW.





Refer to the link below to Racing NSW registration section for more details:
http://www.racingnsw.com.au/default.aspx?s=register-colours





NAMING
One of the highlights of ownership must be naming your horse. It is a lot of fun putting some ideas together and coming up with a great headline name.

Would you have thought of “Bradburys Luck” for a colt by Redoutes Choice out of Skating?
Or “Ringa Ringa Rosie” for a daughter of Bradburys Luck?
Or “Eleecopter” for a Spinning World out of Eleebana?
Or “Chess” for Strategic x Slow Motion?

You can choose a name with up to a maximum of eighteen letters including spaces and then double check it is available on our website under Horse Activity Search, then Horse Name.

For a group of owners, there is normally a majority vote on the name suggestions put forward.

Click on the link below for Racing NSW horse registration section for available names:
http://www.racingnsw.com.au/default.aspx?s=search


Click on the link below for more details on the rules of horse naming:
http://www.risa.com.au/registrarofracehorses/registerahorse.asp



 


STARTING POINTS:


For racehorse ownership, we would recommend you to consider four main subjects:


d1. Budget


2. Location


3. Ownership type


4. Horse category


 



BUDGET

1. How much do you want to spend on the initial outlay for your horse or share?


Most people have an idea of the sum they have available to spend, the decision is normally whether to take a small share in a more expensive horse, or a larger share in a cheaper horse.


The size of the share also dictates the monthly or regular costs to maintain the horse.




Example:

  • When considering the amount you want to spend and the relevant percentage, you will need to allow for the additional costs involved in the purchase of the horse, such as vetting, transport, agistment, insurance etc and any commission charged by a trainer or agent.
  • Ten is the maximum number of names which are allowed to be listed in a race book for a horse. These names can be people &/or syndicate names. When there are more than ten people with ownership, syndicates names will need to be registered and this affects ticketing rights.
  • The maximum number of people or syndicates allowed to be registered in a horse would theoretically be 200, 10 syndicates of 20 people each, but is normally around five to twenty.
  • If your budget is less than $2,000, you can pool your funds with family and friends to create a syndicate to race a share in horse, or consider a Racing Club structure, see below.



 


2. How much do you want to spend on monthly outgoings?

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The table below is based on 100% ownership per month averaged over 12 months, including all the typical costs outlined underneath the table, excluding major nominations and any surgery:



 


In addition to a trainers stipulated daily training fee, you will be responsible for associated fees, which can include:

Trainers invoice:
Daily training fee, medications, equipment, race track fees (e.g. track gallops, walking machines), farrier, dentist, chiropractor/physiotherapist, staff attendance (barrier trials, race days), race club fees (e.g. barrier trials, nominations, scratchings, acceptances)

Vet invoice:
Worming, wound treatment, blood tests

Transport invoice:
Transport to and from spelling farms and race tracks

Spelling Farm invoice:
Agistment costs for paddocks, boxes, pre-training, breaking-in, farrier, dentist, vet

Race club invoice:
Nomination fee, acceptance fee

Racing NSW invoice:
BOBS nomination fee, horse registration fee, syndicate name registration fee, jockey colours registration fee



 


LOCATION


2. Where do you want your horse trained? Locally? Or at a Metropolitan track?



You can choose a trainer that is based locally in your area, or you may have a favourite trainer that is based elsewhere. How often do you want to visit or see your horse? How far do you want to travel to see your horse race? Horses move easily between metropolitan and provincial/country tracks and horse transport is readily available, but what about you?



 


OWNERSHIP

3. What type of ownership structure would suit you?


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Sole ownership – is when you own the horse outright, name it, race it in your colours, get 100% of the owners share of the prize money and pay all the costs, with the added benefit of flexibility in decision making and direct communication from the stable.


Partnership – is when you race the horse with up to ten family, friends or stable clients and share the thrill of ownership for a percentage of the cost and prize money. You can be invoiced individually for your percentage by the trainer and other suppliers, such as the transport company, with a small fee charged by each supplier for multiple invoices. Communication will normally be handled by the Race Manager (first named) or the stable directly.


Syndicate– is when you register a syndicate name with Racing NSW for one to a maximum number of twenty people and race a horse or share in the syndicate name.


e.g. Lets Go Racing Today – Mgr: T.Manager - 10 members with 10% each
Race a 10% share in a racehorse – i.e. 1% each in the horse
Manager opens a bank account for each member to contribute a set monthly fee and pays trainer etc per 10% invoice and receives 10% of prize money to be distributed accordingly


The Syndicate Manager would be responsible for all communication to the syndicate members from the Racing Manager or the stable directly.


For more information on registering firms, companies, studs or natural persons, visit:http://www.risa.com.au/registrarofracehorses/registersyndicate.asp



 


Licensed promoters - Syndications – you race the horse with family, friends or new friends and share the thrill of ownership for a percentage of the cost with the added benefit of legal documents which include publicly disclosed details, such as all costs and vet checks, and a signed partnership agreement outlining the procedures for managing the horse, such as how to vote on the horse name, how to distribute trophies and how to manage disputes.


The product disclosure statements can only be issued by authorised licence holders and their approved representatives and must be approved by Australian Securities Investment Commission (ASIC) and the local regulator, i.e. Racing NSW.


e.g. Social Syndications offers 10 shares @ $10,000 each

This includes horse purchased for $70,000 plus itemised costs such as vetting, transport, agistment, breaking in, office suppliers, advertising, commission etc. There will also be a management fee which varies according to the promoter (syndicator).


They will supply a product disclosure statement with the details of the horse and you will sign and return the application form and partnership agreement.


Racing club – you buy shares through a prospectus in a company which is registered to race multiple horses and receive any prize money or capital gains as an annual dividend. Typically 500 – 1,000 shares are issued for a one-off fee for three years.


e.g. Racing Rules Club offers 1,000 shares @ $500 each

This includes purchase of 3 horses and training costs for two years.

They will supply a prospectus with the details of the strucutre and you will sign and return the form.


Leasing – you race the horse with family or friends, without purchasing or owning the horse, by paying the training fees and earning a lower percentage of prize money, typically 66-75%, which is shared with the owner.



 


HORSE CATEGORIES:

4. What type of thoroughbred are you interested in? Two year old for the Golden Slipper? An older horse for the Sydney Cup? Or a broodmare to breed from?



Horses can be offered for sale at different ages, both through auction houses, publicly and privately. They can basically be categorised in the following groups:


Weanling: is a young horse, typically 6-12 months old, that has been separated from its mother.
Yearling: is a young horse, typically 12-24 months old, that has not been broken in yet.
2yo: untried: is a 24-36 months horse, which may have been broken in, but has not raced yet.
2yo: tried: is a 24-36 months horse, which has been broken in and raced.
Ready to Run: is a 2yo horse which is unraced but “ready to run” has been timed over 200m.
3yo +: is a 3yo and older horse, which has normally been broken in and may be tried or untried.
Horse in Training: is a horse of any age which is ready to race and may have a race record.
Broodmare &/or foal: a mare which is ready for breeding (3yo plus) and may be in foal, have a foal on the ground, be empty (dry) or ready to be served during breeding season (Sep – Dec).


Additionally, the description of the sex of the horse will change according to the age:


Filly: a female horse up to 3 years of age.
Colt: a male horse up to 3 years of age.
Gelding: a male horse which as been desexed is termed a gelding at any age.
Mare: a female horse from 4 years of age upwards.
Horse or Entire: a male horse from 4 years of age upwards.
Broodmare: once a female horse is retired to stud duties.
Stallion: once a male horse has been retired to stud duties.

 


The most popular market or forum in Australia is the purchase of yearlings from auction houses. At this age they have grown and matured sufficiently for buyers to form an opinion on their conformation and attitude. However, they are young enough for trainers to break in and educate using their own preferred methods and schedule.


The buyer of the yearling, which could be a trainer, bloodstock agent, syndicator or breeder, may then offer the horse or shares in the horse to their clients. It is important to note that in order to offer shares publicly, i.e. 10 shares @ $10,000 each, they must be a holder of an AFSL licence, or an authorised representative of one, and have prepared and issued a product disclosure statement approved by ASIC and the local regulator i.e. Racing NSW.



 


 


THE NEXT STEP:



Are you ready? Contact any of the following, or call me and I will arrange an introduction:

  • Auction company
  • Bloodstock Agent
  • Trainer
  • Syndicator
  • Racing Club
  • Leasing forums

 


Auction company

You can buy a horse directly from an auction house:

William Inglis & Sons; based in Sydney, hold auctions primarily in Sydney, Melbourne and Scone.
http://www.inglis.com.au/

Magic Millions Sales; based at the Gold Coast, primarily hold sales at the Gold Coast, Adelaide, Perth and Tasmania
http://www.magicmillions.com.au/index.html


Questions to ask a thoroughbred auction house:
What is the procedure for registering as a buyer?
What credit terms do you provide?


Bloodstock Agents
You can select a bloodstock agent from the Federation of Bloodstock Agents to advise you:
http://www.bloodstockagents.com.au/

Questions to ask a bloodstock agent:

How long have you been registered as an agent?
What horses have you selected which have been successful?
Are you independent or which owner, stud or trainer are you closely associated with?
What is your fee for recommending or inspecting a horse?
What is your fee for purchasing a horse on my behalf? Flat rate or percentage?



 


Trainers
You can select a trainer from the list of licensed NSW trainers to advise you:
http://www.racingnsw.com.au/default.aspx?s=search-trainer


Questions to ask a trainer ;
What is your daily rate and other fees? How much do you estimate over 12 months?
How do you communicate with owners?
When can I visit my horse? What days and hours are suitable?
Where will the horse spell?
How many horses in training?
Do you specialise in particular types of horses?
What horse would you suggest?
Do you have other clients I could race a horse with?

 


Syndicators
You can select a syndicator from the list of Racing NSW approved promotors and representatives to advise you:
http://www.racingnsw.com.au/default.aspx?s=registered-syndicate-promoters


Questions to ask a syndicator ;
Who will be training the horse?
How many shares are for sale at what price?
What are the ongoing costs and when are they due?
Who did you buy the horse from?
What is the breakup of the costs included in the share price?
What are management and ongoing fees for the syndicate manager?
What bonus and race series is the horse eligible for?
Can you please send me a product disclosure statement?

 


Racing Club
You can select a Racing Club:

Questions to ask a racing club:
Who will be training the horse/s?
How many shares are for sale at what price?
What are the ongoing costs and when are they due?
Who did you buy the horse/s from?
What is the breakup of the costs included in the share price?
What are management and ongoing fees for the race club manager?
What bonus and race series is the horse eligible for?
Can you please send me a prospectus?


Owning Racehorses and the Personal Property Securities Act
The new personal property securities regime (“PPS”) under the Personal Property Securities Act 2009 (Cth) (“PPSA”) will come into effect in Australia on 30 January 2012 and it is extremely important that all racehorse owners immediately become familiar with the benefits and risks arising under it.

This is new Commonwealth Government Legislation that impacts ownership of many assets, including racehorses. We recommend that you read this notice carefully and act immediately.

Racing or breeding leasing arrangements by racehorse owners will be deemed to be “PPS Leases” under this new law. Any owner leasing their horse to another party should act immediately.

They will need to register their ownership of the horse on the government’s new national PPSA register. This is a separate process to lodging the usual racing lease document with RISA or Racing NSW.

Also, it is possible that the broad wording of the PPSA in its present form would be interpreted so as to extend to arrangements between owners, trainers, agistment properties or any other entities that have care of the owners’ horses.

The Australian Racing Board, on behalf of the Industry, has made representations to the Attorney General pointing out that the broad nature of the PPSA may unexpectedly capture these arrangements which appears to be contrary to the Government’s intent. However, pending any decision by Government, for the moment these agreements (whether they be written or oral) should also be registered.

What does the PPSA protect?
It protects your ownership of the horse. If you don’t register your interest on the PPSA register whilst ever your horse is in someone else’s care, a third party could register an interest over your horse and gain possession of it should the lessee or other carer strike financial trouble.

In New Zealand where similar legislation has been in force for some years, a stallion on Lease to a stud was lost by the owners because they had not registered their interest on the PPSA. The stud leasing the horse was in financial trouble and a third party (finance company) had registered an interest over the horse.

Under the legislation, the finance company took possession of the horse when payments weren’t met. Known as the Generous case (the name of the horse) a court challenge against the loss was unsuccessful.

What should you do?
You should prepare to register your interests in all the horses that you own, including part shares, from 30 January 2012. You should also ensure that any other persons that share an interest with you in the horse do the same.

If 100% of each horse is not validly registered, then your interest may be jeopardized. To register your interest, you can set up an account now in preparation for the start date. See below for options to be redirected to the PPSA register.

Is there help?
Yes. The Government has set up a PPSA website - www.ppsr.gov.au - which includes a help line 1300 007 777, an email address - enquiries@ppsr.gov.au and a number of guidelines.

How much time do you have?
The law takes effect 30 January 2012, but you are best to begin preparations beforehand, especially for any new Leases for your horse.
Also, at present all other racehorse transactions are also captured under the Act (such as owner/trainer, owner/agistment property and owner/pre-training provider etc). Whilst the Australian Racing Board has sought exemption from the Attorney-General’s Department, it is recommended that you should register all interests as described in case exemption is denied.

Disclaimer
The material on this notice is provided for general information only, and on the understanding that Racing NSW is not providing professional advice on a particular matter.

This notice contains information that is intended to simplify the law for ease of comprehension. In addition, errors or omissions can occur in the preparation of notices. Therefore, before relying on the material, users should independently verify its accuracy, completeness, relevance for their purposes and that it is up-to-date.

Before any action or decision is taken on the basis of any material in this notice the user should obtain appropriate independent professional advice.