In Betfair Pty Limited v Western Australia [2008] HCA 11 the High Court decided that Western Australian legislation outlawing the operation of betting exchanges was unconstitutional because it imposed protectionist burdens on interstate trade and therefore contravened section 92 of the Constitution.

Befair held a licence under Tasmanian law to operate a betting exchange, by which bets may be laid on a horse or a team losing as well as winning. Customers from all over Australia can place bets by telephone or internet.

But provisions of WA’s Betting and Racing Legislation Amendment Act, which came into effect on 29 January 2007, made betting with a betting exchange an offence.

The High Court held that section 24(1aa) was invalid to the extent that it applied to a person who made or accepted offers to bet through the use of Betfair’s betting exchange by telephone or internet between WA and Betfair’s Hobart premises. Section 27D(1) was invalid to the extent that it would apply to Betfair’s publishing or making available WA race fields by telephone or internet between Tasmania and another State.