Full Federal Court Upholds Victorian Betting Regulations

OUTCOME: Allowed

FEDERAL COURT OF AUSTRALIA

[NAME] v [COMPANY] [2012] FCAFC 143 Citation: [NAME] v [COMPANY] [2012] FCAFC 143

[NAME] from: [COMPANY] v [NAME] [2011] FCA 961

Parties: [NAME] v [COMPANY] (ABN 87 [PHONE]), [APPELLANT] 135 267 597), [COMPANY] (ABN 66 [PHONE]) AND THE [NAME] COMMISSION FOR [NAME] [COMPANY] (ABN 66 [PHONE]) v [COMPANY] (ABN 87 [PHONE]), [APPELLANT] 135 267 597), [NAME] AND THE [NAME] COMMISSION FOR GAMBLING REGULATION

File numbers: VID 1000 of 2011 VID 1002 of 2011

Judges: [NAME], [NAME] AND [NAME] of judgment: 12 October 2012

Date of [APPELLANT] 23 October 2012

Catchwords: Constitutional law — Trade and commerce between the [NAME] and a State — [APPELLANT] [NAME] contravened offence provisions of [NAME] legislation by installing an electronic device for betting in an hotel in [NAME] [APPELLANT] engaged in trade and commerce between the [NAME] and a State — Whether offence provisions imposed a discriminatory burden of a protectionist kind on out-of-state trade and commerce — Whether a [NAME] holding a statutory [NAME] was a proxy for [NAME] — reasonably necessary and appropriate and adapted — [NAME] (Self-Government) Act 1978 s 49 — Commonwealth Constitution s 92.

Legislation: Constitution ss 92, 109 [NAME] 1989 (Cth) [NAME] (Self-Government) Act 1978 (Cth) s 49 Betting Act 1853 (16 & 17 Vict c 199) [NAME] ([NAME]) Gambling Regulation Act 2003 ([NAME]) ss 2.1.2, 2.5.1, 2.5.2, 2.5.14, 2.6.1, 4.2.1, 4.2.2, 4.3.1, 4.3.3, 4.5.3, 4.5.6, 4.7.2, 10.5.9(1)(c) Gaming and Betting Act 1994 ([NAME]) Liquor Control Reform Act 1998 ([NAME]) s 115 [NAME]) Act 1990 (NT) Interpretation of Legislation Act 1984 ([NAME]) Lotteries Gaming and Betting Act 1966 ([NAME]) s 66B Police Offences Statute Amendment Act 1872 ([NAME]) [NAME] 1958 ([NAME]) s 4 [NAME] Act 1983 (NT) [NAME] ([NAME]) Act 1960 ([NAME]) Unlawful Betting Act (NT) ss 31, 33

Cases cited: [NAME] v [NAME] (1999) 199 CLR 160 [COMPANY] v [COMPANY]) (2005) 224 CLR 322 [COMPANY] v [NAME] (1985) 157 CLR 605 [COMPANY] v The Commonwealth (1948) 76 CLR 1 [NAME]) v [NAME] (1990) 171 CLR 182 [NAME] v [COMPANY] (1988) 165 CLR 411 Bayside City Council v [COMPANY] (2004) 216 CLR 595 [COMPANY] v [NAME] (2012) 286 ALR 221 [COMPANY] v [NAME] (2008) 234 CLR 418 [COMPANY] v [NAME] (2010) 189 FCR 356 Bond v Foran (1934) 52 CLR 364 [COMPANY] v [NAME] (No 2) [COMPANY] (2001) 117 FCR 424 [COMPANY] v [NAME] (1990) 169 CLR 436 [COMPANY] v [NAME] (1978) 140 CLR 120 [NAME] (1988) 165 CLR 360 Dearman v Dearman (1908) 7 CLR 549 [NAME] v [NAME] (2003) 214 CLR 118 [NAME] v Commonwealth (2000) 202 CLR 479 [COMPANY] v [NAME] (1977) 136 CLR 475 Hogan v Hinch (2011) 85 ALJR 398 Kartinyeri v Commonwealth (1998) 195 CLR 337 Lamshed v Lake (1958) 99 CLR 132 [COMPANY] v [NAME] [COMPANY] [2003] 1 WLR 1462 [NAME] v [COMPANY] (1986) 161 CLR 556 [NAME] v [NAME] (2001) 205 CLR 507 [NAME] v [NAME] Commission (2004) 220 CLR 181 [COMPANY] v [NAME] Authority of [NAME] (1975) 134 CLR 559 [COMPANY] v [NAME]) (1940) 64 CLR 169 [NAME] v [COMPANY] (2010) 189 FCR 448 [COMPANY] v [NAME] (No 6) [2012] FCA 896 [COMPANY] v [NAME] (2012) 286 ALR 404 [COMPANY] v [NAME] (2011) 282 ALR 423 [NAME] v [NAME] (No 6) [2012] FCA 896 [NAME] and [COMPANY] v [NAME] (2012) 286 ALR 221 [COMPANY] v [NAME] (2003) 133 FCR 63 [NAME] v [COMPANY] (1989) 168 CLR 461 [NAME] (2007) 233 CLR 307 [NAME] v [NAME] (1980) 145 CLR 266 [COMPANY] v [NAME] (1953) 87 CLR 1 [NAME], "Section 92, Factual Discrimination and the High Court" (1991) 20 FL Rev 240 [NAME] G (ed), They're [NAME]! The Complete Story of [NAME] ([COMPANY], 1999) [NAME], A Report on Integrity Assurance in the [NAME], 1 August 2008 [NAME[NAME], A Mug's Game. A History of Gaming and Betting in Australia ([NAME[COMPANY], 1988) [NAME[NAME], A Century Galloped By. The First Hundred Years of the [NAME] ([NAME], 1988) [NAME], "Grounding the High Court's Modern Section 92 Jurisprudence: the Case for Improper Purpose as the Touchstone" (2005) 33 FL Rev 445 [NAME], "Intention or Effect? Commonwealth and State Legislation after [NAME] v [NAME]" (1995) 69 ALJ 332

Date of hearing: 20 – 22 February 2012

Date of last submissions: 7 September 2012

Place: [APPELLANT]: GENERAL DIVISION

Category: Catchwords

Number of paragraphs: 325

VID 1000 of 2011: Counsel for Appellant: [redacted]

[NAME]: [NAME]

Counsel for the First and Second Respondents: [redacted]

Solicitor for the First and Second Respondents: [redacted]

Counsel for the [APPELLANT]: [[APPELLANT]]

Solicitor for the [APPELLANT]: [[APPELLANT]]

The [APPELLANT] submitted to any order the Court might make, save as to costs.

VID 1002 of 2011: Counsel for the Appellant: [redacted]

[NAME]: [APPELLANT]

Counsel for the First and Second Respondents: [redacted]

Solicitor for the First and Second Respondents: [redacted]

Counsel for the [APPELLANT]: [[APPELLANT]] Solicitor-General for [NAME] with [NAME] [COUNSEL] and [NAME] [COUNSEL]

Solicitor for the [APPELLANT]: [NAME]

FEDERAL COURT OF AUSTRALIA

[NAME] v [COMPANY] [2012] FCAFC 143 [APPELLANT]

1. In paragraph 180 of the Reasons for Judgment, in the fourth sentence, the word "[NAME]" should read "[NAME]" so that the sentence reads: "The possibility of [NAME] manipulation cannot be discounted, as [NAME] sought to do." I certify that the preceding one (1) numbered paragraph is a true copy of the [APPELLANT] to the Reasons for Judgment herein of the [NAME] and [NAME].

Associate: Dated: 23 October 2012 IN THE FEDERAL COURT OF AUSTRALIA [APPELLANT] 1000 of 2011

ON [NAME] FROM THE FEDERAL COURT OF AUSTRALIA

BETWEEN: [NAME]

Appellant

AND: [COMPANY] (ABN 87 [PHONE])

[APPELLANT] 135 267 597)

[APPELLANT]

[COMPANY] (ABN 66 [PHONE])

[APPELLANT]

THE [NAME] COMMISSION FOR [APPELLANT] OF ORDER: 12 OCTOBER 2012 [APPELLANT]

THE COURT ORDERS THAT:

2. Within seven days, the [NAME] file short minutes giving effect to the reasons for judgment herein.

3. If the [NAME] are unable to agree within seven days on the appropriate costs orders for the proceeding before the [NAME] judge and for the [NAME], within a further seven days, the [NAME] file and serve its written submissions as to the appropriate costs orders and, within seven days thereafter, the [NAME] file their written submissions. In either case the submissions should not exceed three pages. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011 IN THE FEDERAL COURT OF AUSTRALIA [APPELLANT] 1002 of 2011

ON [NAME] FROM THE FEDERAL COURT OF AUSTRALIA

BETWEEN: [COMPANY] (ABN 66 [PHONE])

Appellant

AND: [COMPANY] (ABN 87 [PHONE])

[APPELLANT] 135 267 597)

[APPELLANT]

[NAME]

[APPELLANT]

THE COURT ORDERS THAT:

1. Within seven days, the appellant in [NAME] 1002 of 2011 file short minutes giving effect to the reasons for judgment herein.

2. If the parties in [NAME] 1002 of 2011 are unable to agree within seven days on the appropriate costs orders for the proceeding before the [NAME] judge and for the [NAME], within a further seven days, the appellant in [NAME] 1002 of 2011 file and serve its written submissions as to the appropriate costs orders and, within seven days thereafter, the [NAME] file their written submissions. In either case the submissions should not exceed three pages. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011

IN THE FEDERAL COURT OF AUSTRALIA [APPELLANT] 1000 of 2011

ON [NAME] FROM THE FEDERAL COURT OF AUSTRALIA

BETWEEN: [NAME]

Appellant

AND: [COMPANY] (ABN 87 [PHONE])

[APPELLANT] 135 267 597)

[APPELLANT]

[COMPANY] (ABN 66 [PHONE])

[APPELLANT]

THE [NAME] COMMISSION FOR [APPELLANT] 1002 of 2011

ON [NAME] FROM THE FEDERAL COURT OF AUSTRALIA

BETWEEN: [COMPANY] (ABN 66 [PHONE])

Appellant

AND: [COMPANY] (ABN 87 [PHONE])

[APPELLANT] 135 267 597)

[APPELLANT]

[NAME] [APPELLANT]

THE [NAME] COMMISSION FOR [APPELLANT]

[APPELLANT]: [NAME], [APPELLANT] AND [NAME]: 12 OCTOBER 2012 PLACE: [APPELLANT] FOR JUDGMENT

[NAME[NAME] INTRODUCTION [1] THE IMPUGNED PROVISIONS [12] [NAME] [16] [NAME] [30] [NAME] [49] THE DECISION OF THE [NAME] JUDGE [61] [NAME] LEGAL PRINCIPLES [69] APPLICATION OF SECTION 49 OF THE SELF-GOVERNMENT ACT [83] CONCLUSION [110]

INTRODUCTION 1 These appeals, and the proceeding from which they are brought, demonstrate the absurdity that, in the worldwide economy of the 21st century, the legal [NAME] of the great nation of Australia is still complicated by wrangling between polities that grew out of the former British colonies that combined to form the Commonwealth of Australia in 1901. This proceeding is concerned specifically with the regulation of wagers and bets placed with a [NAME] by [NAME] physically located in [NAME]. It is a blight on our nationhood and a travesty of sensible administration and good government that there are eight different regulatory regimes concerning lawful gambling in Australia, with an overlay of federal intervention, both actual and threatened. 2 The draughtsmen of the Constitution saw the need for the new nation to be absolutely free from inter-colonial rivalries, at least in relation to trade, commerce and intercourse. Thus, s 92 of the Constitution relevantly provides that trade, commerce and intercourse among the [NAME] is to be absolutely free. When self-government was conferred on the [NAME], that principle was extended. Section 49 of the [NAME] (Self-Government) Act 1978 (Cth) (the Self-Government Act), which is an act of the Commonwealth parliament, relevantly provides that trade, commerce and intercourse between the [NAME] and the [NAME] is also to be absolutely free. The jurisprudence that has arisen in connection with s 92 is applicable to the construction and operation of s 49 of the Self-Government Act (see [NAME] v [NAME] (1999) 199 CLR 160 at 175-176 [35]-[36]). To the extent that a law of [NAME] is inconsistent with s 49 of the Self-Government Act, that law would, by the operation of s 109 of the Constitution, be invalid. 3 Section 92 of the Constitution refers to trade, commerce and intercourse by means of internal carriage or ocean navigation. That was probably intended to cover the field of the means by which trade, commerce and intercourse among the [NAME] might take place. The concept of trade, commerce or intercourse by means of digital electronic communication, such as is involved in the present dispute, was not conceived of by those responsible for the drafting of the Constitution. 4 The particular dispute in question in these appeals is principally between two corporate [NAME], namely, [COMPANY] ([NAME]) and [COMPANY] ([NAME]). Each of those companies has its [NAME] in [NAME], although [NAME] is a [NAME] company. Both companies operate in a gambling market that is Australia-wide and is, in some respects, worldwide. Each engages in gambling activities in [NAME]. 5 [NAME] is Australia's largest corporate [NAME]. [NAME] uses computer equipment that is located in the [NAME] that communicates, by means of the internet, with a device known as a [NAME], which is located in [NAME]. The devices are accessible to, and are used for the purpose of [NAME] with [NAME] by, persons located distant from the [NAME], in [NAME]. 6 In May 2010, a [NAME] owned by [NAME] was installed by [NAME] in the [APPELLANT] in East Ballarat, [NAME] ([COMPANY]), which is owned by [APPELLANT] [COMPANY] ([APPELLANT]). [APPELLANT] is the [NAME] of [COMPANY] under the Liquor Control Reform Act 1998 ([NAME]) (the Liquor Act) and [COMPANY] constitutes licensed premises under the Liquor Act. [NAME] entered into contracts with [APPELLANT] for the installation of a [NAME] at [COMPANY]. It then installed and used [NAME] in [COMPANY] and accepted wagers over the internet by means of that [NAME] from persons physically located in [COMPANY] in [NAME]. 7 The present dispute is concerned more specifically with the seizure in July 2010 of [NAME] located in [COMPANY] by officers of the [NAME] Commission for Gambling Regulation (the Gambling Commission). The officers were acting under s 10.5.9(1)(c) of the Gambling Regulation Act 2003 ([NAME]) (the [NAME]), which authorises the seizure of any machinery, equipment or records for the purpose of obtaining evidence of the commission of an offence. 8 [NAME] and the Gambling Commission contend that the installation and the operation of [NAME] in [COMPANY] gave rise to offences under several laws of [NAME] (the Impugned Provisions) as follows: Section 2.5.2 of the [NAME], which prohibits [NAME] from opening, keeping or using a [NAME]; Section 2.6.1 of the [NAME], which prohibits [NAME] from possessing an instrument of betting not authorised by the [NAME]; and Section 115 of the Liquor Act, which generally prohibits the [NAME] of a [NAME] under the Liquor Act from allowing [NAME] to bet on licensed premises. 9 [NAME] and [APPELLANT] contend that the Impugned Provisions are invalid in so far as they affect the installation and use by [NAME] and [APPELLANT] of [NAME].

Accordingly, following the seizure of [NAME], [NAME] and [APPELLANT] commenced a proceeding in the Court against [NAME] (the State) and the Gambling Commission, seeking an order for the return of [NAME] to [NAME] or, alternatively, to [APPELLANT]. As well as the return of [NAME], [NAME] and [APPELLANT] claimed declarations that each of the Impugned Provisions is invalid to the extent that it would apply to installation and use of a [NAME] in [NAME]. Subsequently, [NAME] was joined as a [APPELLANT] to the proceeding. 10 On 9 September 2011, for reasons published on 22 August 2011, a judge of the Court ordered that [NAME] be returned to [APPELLANT] at [COMPANY]. The [NAME] judge also declared that each of the Impugned Provisions is invalid to the extent that it applies to the installation and use in [NAME] by [NAME] and [APPELLANT] of the computer device known as a [NAME]. 11 By notice of [NAME] filed on 13 September 2011, the State appealed from those orders. [NAME], [APPELLANT], [NAME] and the Gambling Commission are respondents to the State's [NAME]. By notice of [NAME] filed on the same day, [NAME] also appealed from those orders. [NAME], [APPELLANT], the State and the Gambling Commission are respondents to [NAME]'s [NAME]. In each [NAME], the appellant seeks an order that the [NAME] be upheld, that the orders made by the [NAME] judge be set aside and that the proceeding brought by [NAME] and [APPELLANT] be dismissed.

THE IMPUGNED PROVISIONS 12 Section 2.5.2(1) of the [NAME] relevantly provides that [NAME] must not: open, keep or use a [NAME]; or being the [NAME] of a house or place, knowingly and wilfully permit the house or place to be opened, kept or used by any other person as a [NAME]. Under s 2.5.1(1), a [NAME] is a house or place that is open, kept or used, relevantly, for the purpose of betting with any persons, whether in person or by messenger, agent, post, telephone or otherwise or for the purpose of taking instructions for the placement of bets on behalf of any person. A betting house or a place of betting is declared by s 2.5.1(2) to be a public nuisance and contrary to law. 13 However, under s 4 of the [NAME] 1958 ([NAME]) (the [NAME]), it is not a contravention of the [NAME] for a [NAME] to take bets on certain events, including thoroughbred, harness and greyhound races, while present at a racecourse licensed under the [NAME] either: during the holding of a race meeting, from a [NAME] present on the racecourse; or at any time, from a [NAME] off the racecourse by means of a method of communication approved by the Minister. A [NAME] is [NAME] who is the [NAME] of a current certificate of registration as a [NAME] under the [NAME]. [NAME] is not a [NAME] and has never sought registration under the [NAME]. 14 Section 2.6.1(1) of the [NAME] relevantly provides that [NAME] must not possess an instrument of betting not authorised under the [NAME]. Under s 2.6.1(2), possession includes actual physical possession, as well as custody or control, and an instrument of betting is taken to be in [NAME]'s possession if it is on land or in premises occupied, used or controlled by the person. Under s 2.1.2(1), instrument of betting relevantly includes a mechanical, electrical, telephonic, electronic or other equipment or device or any access to such equipment or device used, apparently used or likely to be used in carrying on or in connection with betting on a sporting event, being betting that is not authorised by any Act. It is common ground that [NAME] is an instrument of betting within the meaning of that provision. It is also common ground that [NAME] seized from [APPELLANT] was likely to be used in carrying on, or in connection with, betting on sporting events. [NAME] is not authorised under the [NAME]. 15 Section 115(1) of the Liquor Act relevantly provides that a [NAME] of licensed premises must not bet or allow [NAME] to bet on the licensed premises. However, under s 115(2), that prohibition does not apply to betting on licensed premises if, relevantly: the premises are on a licensed racecourse and the betting is engaged in during the holding of a race meeting on the licensed racecourse; or a betting facility of the [NAME] or of the [NAME] is established in the premises and the betting takes place through that [NAME] [NAME] or [NAME]. At the present time, [NAME] is the [NAME], as referred to in s 115(2), and [COMPANY] ([NAME]), a wholly owned subsidiary of [NAME], is the [NAME], as referred to in s 115(2). The term betting facility, as referred to in s 115(2), is not defined.

[NAME] 16 Until the late 1950s, offcourse [NAME] was prohibited in [NAME]. [NAME] was permitted with [NAME] and with a [NAME] operated by a [NAME] club. 17 Generally, [NAME] with [NAME] was fixed odds [NAME]. A fixed odds [NAME] is one who makes up a book on all the contestants in a given race, adjusting the odds and the volume of money taken on any particular contestant, so that, if the adjustments made by the [NAME] are correct, at the end of the race, no matter which contestant wins, the book would show a profit for the [NAME]. While oncourse [NAME] competed with each other by offering differing fixed odds for each contestant in a race, such that the odds would vary during the lead up to the start of the race as the [NAME] made the book, a [NAME] was guaranteed the odds at which the wager was made, irrespective of variations in the odds being offered after the wager was made. 18 [NAME] with a [NAME], on the other hand, was on the pari-mutuel basis. That is to say, the balance of the total [NAME] of wagers made with the [NAME], after deducting a fixed proportion of the wagers for the [NAME] [NAME], was divided among the [NAME]. Thus, the odds that would be paid on a [NAME] wager with a [NAME] would not be known until after the start of the race, when betting closed and the total [NAME] was ascertained. 19 While offcourse [NAME] was prohibited, it was widespread. Generally, offcourse [NAME] was with [NAME] and was, for the most part, [COMPANY] to starting price wagers. The odds for each contestant at the close of betting on a race, which were published after the event, were the odds at which starting price wagers were determined. Thus, as with a [NAME], the odds that would be paid on a [NAME] wager would not be known until after the start of the race, when betting closed. 20 A significant difference between the [NAME] [NAME] and the [NAME], whether fixed odds or starting price, is that the [NAME] [NAME] cannot lose. An oncourse licensed [NAME], offering fixed odds, was generally required to accept any wager, up to predetermined limits. A competent [NAME], by adjusting the odds for each runner in a race, assuming a minimum number of wagers, could make a book so as to ensure a profit on most races. A starting price [NAME] could not adjust the odds, but had some control, in so far as the [NAME] could refuse to accept a bet. However, a profit is never guaranteed for either a fixed odds or starting price [NAME]. 21 In 1959, a report to the [NAME] recommended the legalising in [NAME] of offcourse betting, by means of the establishment of an offcourse [NAME]. Following that recommendation, an offcourse [NAME] was established under the [NAME] ([NAME]) Act 1960 ([NAME]) (the 1960 Act). The offcourse [NAME] was operated by the Totalizator Agency Board (the [NAME]), a statutory body corporate created by the 1960 Act. Until 1994, offcourse [NAME] could be conducted in [NAME] legally with the [NAME], but not otherwise. 22 In 1994, the [NAME] decided to privatise the operations of the [NAME]. To that end, [NAME] was incorporated as the [NAME] that would acquire the operations of the [NAME]. The Gaming and Betting Act 1994 ([NAME]) (the 1994 Act) provided for the grant of a single [NAME] to conduct pari-mutuel betting on thoroughbred, harness and greyhound [NAME] and on approved betting competitions. The single [NAME], together with a concurrent gaming [NAME], was granted to [NAME] on 28 June 1994 for a period ending in August 2012. At the same time, [NAME] acquired the operations of the [NAME], including its assets and staff. The consideration paid by [NAME] for the operations of the [NAME] and for the grant of the [NAME] was approximately $600 million. [NAME] raised those funds by the issue of shares to the public. In effect, from 1994, [NAME] stepped into the shoes of the [NAME], and the operations of the [NAME] were thereby effectively privatised. 23 At the same time, [NAME] entered into joint venture arrangements with [COMPANY] ([NAME]), a representative body of the [NAME]. The arrangements gave effect to a memorandum of understanding made between the [NAME] and representatives of [NAME]. [NAME] was obliged to make substantial payments to fund [NAME] and was subjected to various other restrictions, limitations and obligations, including obligations that allow [NAME] to have strategic and operational oversight of, and input into, the operations of [NAME]. 24 The 1994 Act was repealed by the [NAME], with effect from 1 July 2004. One of the main purposes of the [NAME] was stated to be to re-enact and consolidate the law relating to various forms of gambling. Its main objectives were said to include: to foster responsible gambling in order to minimise harm caused by problem gambling and accommodate those who gamble without harming themselves or others; to ensure that other forms of gambling permitted under [NAME] of parliament are conducted honestly and that their management is free from criminal influence and exploitation; and to promote tourism, employment and economic development generally in [NAME]. 25 Another purpose of the [NAME] was stated to be to impose a general prohibition on gambling and to create certain offences, including those created by ss 2.5.2 and 2.6.1. Section 2.5.2 is derived directly from the Police Offences Statute Amendment Act 1872 ([NAME]), which amended the Betting Act 1853 ([NAME]). Section 2.6.1 was first enacted in 1986 as s 66B of the Lotteries Gaming and Betting Act 1966 ([NAME]). Thus, the [NAME] carries on the scheme previously existing under the 1994 Act, which, in turn, broadly reflected the scheme introduced by the 1960 Act. 26 Section 4.2.1 of the [NAME] provides that the conduct of [NAME] or approved betting competitions is lawful when conducted in accordance with a [NAME] or permit granted under Chapter 4. Such [NAME] and approved betting competitions are not a public or private nuisance and a place in which such [NAME] or approved betting competitions is conducted is not a [NAME]. [NAME] is defined as pari-mutuel betting on a horse race, harness race or greyhound race. An approved betting competition on a horse, harness or greyhound race is one approved by the Minister under s 4.5.3 of the [NAME] or by the Gambling Commission under s 4.5.6. Under s 4.5.3, the Minister may approve a betting competition on an event or contingency, or a class of event or contingency, of or relating to a horse race, harness race or greyhound race. 27 Under s 4.3.3 of the [NAME], there can be only one [NAME] [NAME] at any given time. Under s 4.3.1, the [NAME] [NAME] authorises the [NAME] and the [NAME] to conduct both [NAME] and approved betting competitions. [NAME] is the [NAME], since it is deemed to be the [NAME]. The [NAME] that had been granted to [NAME] on 28 June 1994 under the 1994 Act was continued under the [NAME]. [NAME] is deemed to be appointed as the [NAME] under s 4.3.1 of the [NAME]. 28 The effect of those provisions is that a place in which [NAME] or an approved betting competition is conducted by [NAME] or [NAME], in accordance with the [NAME] granted to [NAME], is taken outside the scope of the various offences concerning common gaming houses or places, including the offences in s 2.5.2. The consequence is that only [NAME] may establish in [NAME] a [NAME] presence for betting. That is described as offcourse [NAME] exclusivity. 29 Sections 2.5.14 and 4.7.2 of the [NAME] prohibit conduct of various kinds in relation to use of a scheme of pari-mutuel betting, whether conducted by means of an instrument or contrivance known as a [NAME] or otherwise. However, under s 4.2.2 of the [NAME], the use of a [NAME] as provided by Chapter 4 is lawful, and [NAME] who uses or conducts a [NAME] as provided by Chapter 4 is not guilty of an offence at common law or under any Act by reason of so using or conducting a [NAME]. Further, [NAME] or betting by means of a [NAME] does not constitute an offence at common law or under any Act, is not a ground for any house or place being taken to be a [NAME] and is not a public nuisance. Chapter 4 of the [NAME] contemplates the use of a [NAME] by [NAME] and [NAME], as the [NAME] of the [NAME] and the [NAME], respectively. The consequence is that, within [NAME], only [NAME] or [NAME] may operate a [NAME]. That is described as [NAME] exclusivity.

[NAME] 30 [NAME] was [NAME] on 29 June 1999 and is taken, under the [NAME] Act 2001 (Cth), to be [NAME] in the [NAME]. [NAME] is recorded as having a [NAME] office and principal place of business in the [NAME]. 31 [NAME] holds a [NAME] under the [NAME] Act 1983 (NT) (the [NAME] Act) to conduct the business of a sports [NAME] in the [NAME]. That [NAME], which was granted on 2 July 2010, requires that [NAME] take bets from its premises situated at the [NAME], near Darwin in the [NAME]. [NAME] is permitted a more flexible approach under its [NAME] to the marketing of its [COMPANY] than it would be permitted in other places in Australia. Specifically, [NAME] is permitted to offer a much wider range of bets to [NAME] than is permitted under the law of [NAME]. Further, under the law of the [NAME], [NAME] is permitted to provide credit to [NAME]. That is contrary to the position anywhere else in Australia. 32 The information reporting [NAME] relating to the operation of [NAME] sports [NAME] includes a full independent audit log of all [NAME] and financial transactions. The purpose of the audit log is to provide the [NAME] Commission (the NT Commission) with the data necessary to resolve any dispute between a sports [NAME] and a customer and to provide the NT Commission with information necessary to enable it to monitor all financial and betting transactions. [NAME] in the [NAME], as part of the conditions of their licences, are required to record and maintain betting and financial information and supply that information to the NT Commission. Voice recordings are made of all communications with customers over the telephone and the recordings must be made available on request from the NT Commission. 33 Each sports [NAME] in the [NAME] must comply with a mandatory code for responsible gambling and is required to establish account opening procedures and steps designed to ensure accounts cannot be opened by under-age customers. Each sports [NAME] must ensure that all [NAME], directors and [NAME] have undergone police checks and have not been found guilty of any offence in the previous 10 years. Each sports [NAME] must have systems in place to record bets properly and to monitor unusual betting patterns and must report unusual betting patterns and circumstances to the NT Commission. 34 Standard condition 8 of [NAME]'s [NAME] under the [NAME] Act provides that [NAME] may accept bets at its designated premises on approved sporting events, by use of the telephone, internet, facsimile or any other electronic means approved by the NT Commission. Standard condition 11 provides that [NAME] must record details of bets made by telephone, facsimile and internet. Special condition 24 provides that [NAME] must ensure that any of its premises that are not situated on a racecourse are not open to the public to attend in person for the purposes of placing a bet. 35 [NAME] has not applied for approval for the use of a [NAME] in the [NAME].

Accordingly, the NT Commission has not approved the use of a [NAME] by [NAME]. Indeed, [NAME] is prohibited under its current [NAME] from installing a [NAME] in the [NAME]. 36 Under s 31 of the Unlawful Betting Act (NT), [NAME], other than a lawful [NAME], who acts as, or holds himself or herself out to be, [NAME] is guilty of an offence. Under s 33 of that Act, [NAME] commits an offence if the person carries on the business of bookmaking other than as a lawful [NAME] or in accordance with any other law in force in the [NAME]. A lawful [NAME] is [NAME] licensed or [NAME] as [NAME] under the [NAME] Act. Bookmaking is defined as the business of receiving or negotiating bets or wagers. So long as [NAME] conducts its business at its premises within the [NAME], it does not offend s 31 or s 33. 37 [NAME] has a [NAME] office and premises in the [NAME], it has much larger premises in [APPELLANT]. It occupies three floors in a building at 367 [NAME], [APPELLANT], where some 150 to 200 employees operate. [NAME]'s business is managed from those [APPELLANT] premises. 38 The total operating expenses of [NAME] are around $100 million a year. Approximately a quarter of those expenses are attributable to the operations in the [NAME]. To the extent that [NAME] employs persons in the [NAME], police checks are conducted in Darwin. Probative verifications for those in [APPELLANT] are prepared in [APPELLANT]. 39 There are up to 50 staff in [NAME]'s [NAME] premises, most of whom are [NAME]. There are also about five IT staff and two or three administrative staff. The work in the [NAME] is seasonal and, on occasions, there are fewer than 40 people in those premises. [NAME] [NAME], who has been the chief financial officer of [NAME] since July 2006 and the chief operating officer of [NAME] since July 2009, spends no more than three to four days a month in the [NAME]. His superior, [NAME] [NAME], spends a similar amount of time in the [NAME]. Both of them spend most of their time managing [NAME]'s business in [APPELLANT]. 40 [NAME]'s marketing department, production department, IT department and human relations department, all of which are staffed by highly qualified people who earn substantial salaries, are located in the [APPELLANT] premises. Financing support and administrative support for [NAME]'s business are also conducted from its [APPELLANT] premises, and the people working in those areas are highly qualified. [NAME] has a dedicated risk management department and a dedicated fraud department, which are the two most important functions in the business of betting. Both departments operate in the [APPELLANT] premises. Checking with respect to money laundering is conducted by [NAME] in [APPELLANT]. No [NAME] in the [NAME] check for money laundering. 41 At its [NAME] premises, [NAME] accepts bets by telephone and over the internet from [NAME] situated throughout Australia, including [NAME]. The contingencies on which [NAME] players bet include thoroughbred, harness and greyhound [NAME] conducted in each [NAME] and sporting events conducted in each [NAME] and internationally. [NAME] wishing to place a bet with [NAME] must first register and acknowledge [NAME]'s terms and conditions. 42 The process of becoming a customer of [NAME] is automated to a large extent. A prospective customer completes details online, either on the internet or on a [NAME], and transmits the details. If the details are verified by the [NAME] in the [NAME], the customer will automatically be accepted as a customer of [NAME] and the [NAME] will generate a welcome pack letter and pamphlets about the [NAME] business, together with a pre-branded card similar to a credit card. The customer can swipe that card on a [NAME] in order to log on to the [NAME] [NAME]. 43 Customers of [NAME] may establish a credit balance with [NAME]. Customers use credit cards to replenish their credit balances. Checks on credit cards are carried out in [APPELLANT]. Decisions to accept customers of [NAME] are made in [APPELLANT]. [NAME] interfaces with customers flow through [NAME]'s [NAME] premises, any notification is triggered in [APPELLANT] and notification of acceptance of a customer emanates from [APPELLANT]. 44 [NAME] reserves the right to decline a deposit from a customer if it determines that the funds are not genuinely for the purposes of betting. Such determinations are made in [APPELLANT]. [NAME] also reserves the right to close a customer's account. Such decisions are made in [APPELLANT]. A decision to suspend a customer's account is also made in [APPELLANT]. [NAME] has a discretion to permit a customer to establish a credit facility. The credit facility is approved or not approved by a third party credit reporting agency in [APPELLANT]. The customer is contacted by [NAME] by email or mail when the credit facility is approved or not approved. That contact comes from [APPELLANT]. [NAME] may choose to approve or decline an application for a credit facility. That decision to approve or decline is made in [APPELLANT]. [NAME] may terminate a credit facility. The decision to terminate a credit facility is made in [APPELLANT]. 45 Approximately 40 highly qualified [NAME] are the risk managers of [NAME]'s business. They work in a room on one of the floors in the [APPELLANT] premises, where there are numerous screens. A task of the [NAME] is to monitor [NAME]'s books and manage the risk of [NAME]'s business. They do so by watching, on the screens in front of them, the bets that are being placed. [NAME]'s computer [NAME] is configured so that, when a bet is placed, it can be observed in [APPELLANT]. While bets are received in the [NAME], they can be seen on the screens in [APPELLANT] a millisecond or so after they are received in the [NAME]. The purpose in having such a [NAME] in place is to enable the [NAME] in [APPELLANT] to monitor [NAME]'s book. Monitoring the book is one of the most fundamental functions of [NAME]. 46 The fixed odds offered by [NAME] on a particular event or contingency are determined by [NAME]'s [NAME] in [APPELLANT]. The odds are placed on the servers in [APPELLANT] and transmitted to the [NAME]. The odds are then capable of being accessed anywhere in the world through [NAME]'s website. As bets are taken on a particular event, such as a thoroughbred, harness or greyhound race, the shape of the book and the nature of the bets are monitored in [APPELLANT] for the purpose, if necessary, of adjusting the odds. When the odds are adjusted, they are adjusted in [APPELLANT]. The [NAME] in [APPELLANT] not only monitor the odds for fixed odds betting but they also monitor the odds on the [NAME]. Depending on the shape of the book, the [NAME] may choose to lay off part of [NAME]'s risk. The laying off of risk is an important area in the business of betting. The decision to do that is made in [APPELLANT]. 47 [NAME] holds money in a trust account on behalf of its customers. It does not maintain separate accounts for each customer. Customers are grouped by type, such as post-paid customers and pre-paid customers, and there is one trust account referrable to each type of customer. Thus, there is one account for pre-paid customers, in which all pre-paid customers' funds are mixed. The [COMPANY] account is an account with [NAME] [COMPANY] in the [NAME]. 48 When a customer wins a bet, the account of that customer is credited with the amount of the win. The customer must have an account with [NAME]. If the customer requests money to be transferred out of the account, the transfer to the customer is effected in [APPELLANT].

[NAME] 49 The [NAME] judge found, quite correctly, that the sole, dedicated and public use of [NAME] is to facilitate betting. It is not merely the means by which the wager is communicated, but is also the means by which the wager is selected, placed and its acceptance is notified. There are distinct and significant differences between the function of [NAME] when a [NAME] places a wager with [NAME] using [NAME], on the one hand, and the function of a telephone or personal computer when a [NAME] places a wager with [NAME] using the telephone or personal computer, on the other. 50 [NAME] is a computer terminal that allows a [NAME], by means of a touch screen, to communicate with [NAME]'s computer servers located at [NAME] in the [NAME], for the purpose of placing bets. On approaching a [NAME] situated in [NAME], a [NAME] accesses information on the website maintained by [NAME] and selects a race on which to place a bet. The [NAME] then selects the wager that the customer wishes to make and sends that as a request, which is received by [NAME] on its server located at [NAME]. 51 A bet placed by means of [NAME] in [NAME] is received in the [NAME] and is accepted or rejected by means of the automated computer [NAME] in the [NAME]. There are certain predetermined bet limits and acceptance levels for which the [NAME] computer [NAME] is programmed. If a bet received is within those predetermined limits and levels, the [NAME] will automatically accept the bet without any human intervention. If a bet or series of bets exceeds a certain tolerance threshold, the bet will be automatically denied. The server automatically communicates [NAME]'s acceptance or rejection of the wager, in a manner that is capable of being shown on [NAME] in [NAME]. 52 [NAME]'s computer [NAME] uses proprietary software developed by [NAME] to process bets, including receiving bets, processing payouts, maintaining ledgers and other processes. Access to the [NAME] in the [NAME], in order to place a bet, is achieved by means of the internet. [NAME] operates two channels through which data is exchanged, one a web browser and the other a web [COMPANY] client. 53 In order to access the [NAME], either through a web browser or through a web [COMPANY] client, it is necessary for a customer to authenticate access by means of a unique ID and password. From the perspective of [NAME]'s [NAME], there is no difference between a member gaining access through a web browser or gaining access through a web [COMPANY] client. There is no difference between the two in function, in that both allow the customer access to [NAME]'s computer [NAME]. However, the computer processes that lie behind the two processes are different. 54 A web browser, such as Internet Explorer or Firefox, allows the [NAME] to access the [NAME] website by means of a personal computer connected to the internet. That, in turn, allows an [NAME] access to the [NAME] for the purpose of placing bets and accessing that person's account. In the case of web browser access, the servers in the [NAME] operate both front end and back end operations. The [NAME] sends out HTML files that are received and interpreted by the web browser. The web browser receives the messages and displays them as a web page. The customer then navigates the web page in order to review the customer's account or to place a wager. All of the data, including the graphics, emanate from the computer servers in the [NAME]. When a wager is placed, it is processed in the [NAME] and the computer [NAME] either accepts or rejects the wager. When it is accepted, a bet number is transmitted over the internet and can be read on the screen at the customer's terminal. Although there are several processes involved, the transaction is very fast. The customer can subsequently track the bet over the internet using the bet number allocated to the bet. 55 A web [COMPANY] client enables the [NAME] to access [NAME]'s computer [NAME] by means of a [NAME]. Once the customer enters the customer's unique identifier and password, the customer is able to access the customer's account and place a wager. [NAME] does not record or save any data in [NAME] itself. It is solely a communication device to allow the customer to access the computer [NAME] maintained by [NAME] in the [NAME]. 56 The key technical difference between web browser access and web [COMPANY] client access, from an information-processing standpoint, is that the web [COMPANY] client, stored on [NAME], processes the graphics. [NAME] receives XML code from the computer server and uses software to present graphical images. A web [COMPANY] client is used for [NAME] access rather than a web browser because the web [COMPANY] client interacts better with the touch screen technology used in [NAME]. 57 Thus, a [NAME] operates in a similar way to a web browser on a personal computer, although it uses different software. [NAME] performs the same computing function as a personal computer, or mobile telephone with internet capabilities. [NAME] is designed to use an ADSL telephone connection to the internet. However, it could also be set up to use a 3G modem connection, such as is commonly used on mobile telephones and personal computers. [NAME] provides convenience for the customer and is designed to operate at high speeds, but does not differ from a personal computer or mobile phone in a functional sense. 58 The [NAME] website advertises all available selections that operate on the [NAME] [NAME]. A customer can log on to [NAME]'s website either by use of the internet with a unique identifier and password or by use of a telephone or facsimile machine. The customer then nominates a bet by selecting the preferred event, the bet type and the bet amount. The customer can transmit that information to [NAME] at its premises in the [NAME] from a location anywhere in the world, either orally over the telephone or electronically by way of the internet. If the bet is received orally over the telephone or by facsimile, the bet is manually entered into the [NAME] computer [NAME] located in the [NAME] by an [NAME] in the [NAME] premises. When a bet is accepted orally over the telephone, the [NAME] informs the customer that the bet has been accepted. If [NAME] accepts a bet, it places a bet confirmation number on [NAME]'s website and the customer can check to see whether the bet has been accepted. The Impugned Provisions do not impose any restrictions on [NAME] in [NAME] betting by telephone or facsimile or by means of a personal computer in the way just described. 59 [NAME] employs a device known as an [NAME]. [NAME] are widely distributed throughout licensed premises in [NAME]. The function of an [NAME] is similar to the function of a [NAME], which is described in more detail below. The use of an [NAME] by [NAME] or [NAME] is lawful if it is conducted in accordance with s 4.3.1 of the [NAME], because it is betting of a kind authorised by s 4.2.1. 60 There is an iPhone application called [NAME]. Once loaded onto an iPhone, that application allows the [NAME] to access [NAME]'s website for the purpose of placing bets. Like a [NAME], an iPhone uses a touch screen interface. The function performed by the application is identical to the function performed by [NAME].

THE

DECISION OF THE [NAME] JUDGE 61 The [NAME] judge found that there is a national [NAME] market and that [NAME] [COMPANY] on [NAME] and sporting events are supplied to users of those [COMPANY] throughout Australia by means of telephone and the internet. [NAME] found that competition in that market has been increasing for at least 10 years and that the competition is now fierce. [NAME] competes in that market with [NAME], which accepts bets through its [NAME], as well as over the internet. [NAME] has also established a [NAME] to compete with [NAME] and other corporate [NAME] offering [NAME] products. [NAME] also competes with licensed [NAME] in [NAME] operating at racecourses, who accept bets by [NAME] present on the racecourse, over the telephone and by means of the internet. 62 [NAME] that was installed in and operated from [COMPANY] was intended to attract customers for [NAME] and to attract patrons to [COMPANY]. Patrons who came to [COMPANY] would be able to have a drink, watch television, eat a meal and place bets by means of [NAME]. The [NAME] for the use of [NAME] granted by [NAME] to [APPELLANT] included a requirement that [NAME] be located in a prominent and visible position adjacent to the main bar. [NAME] paraphernalia was disseminated throughout the bar in order to attract customers. 63 The [NAME] judge found that [NAME] is an instrument of betting and that its sole, dedicated and public use is to facilitate betting. It is not merely the means by which a bet is communicated but is also the means or mechanism by which the bet is selected by the [NAME], placed with [NAME] and its acceptance is notified by [NAME]. When a bet is placed on a [NAME] in [NAME], [NAME] is the indispensable or essential means for so placing the bet. By installing [NAME] in [COMPANY], [NAME] localised [COMPANY] as the stand or pitch where bets are executed. Further, [NAME], including the computer terminal located within it, constitutes a physical presence of [NAME] within [COMPANY]. 64 The [NAME] judge held, correctly, that s 2.6.1, by its express terms, is directed at physical possession, custody or control of, or access to, an instrument of betting in [NAME]. It is not concerned with a [NAME] contract, or the proper law or governing law of a [NAME] contract, but with the physical instrument and its possession or deemed possession in [NAME]. The prohibition in s 2.6.1 has nothing to do with [NAME]'s computer [NAME] in the [NAME]. Rather, it is directed at prohibiting the physical presence in [NAME] of an instrument that is used in carrying on, or in connection with, betting on a sporting event and possession by [NAME] of that instrument. The prohibition operates, in the present case, on possession of [NAME], which is the means or mechanism by which a wager is selected, placed and its acceptance is notified, at [COMPANY]. Possession of [NAME] enables any one of those objectives to be achieved. 65 In those circumstances, the [NAME] judge found that the installation and use of [NAME] in [COMPANY] contravened the Impugned Provisions. However, [NAME] found that a contract made between a [NAME] and [NAME] by means of a [NAME], by its nature, involves the movement, from a place in [NAME] to a place in the [NAME], of things tangible or intangible. [NAME] concluded therefore, that the business of [NAME], in accepting wagers placed through its [NAME] situated in [NAME], constitutes trade and commerce between the [NAME] and [NAME] and that the Impugned Provisions impose on that trade and commerce a discriminatory burden that is protectionist in nature. 66 The [NAME] judge considered that, once it was accepted that the Impugned Provisions constitute a [NAME] burden, the State had the onus of establishing that the burden was appropriate and adapted to a legitimate end. [NAME] considered that, in determining whether a particular provision is appropriate and adapted to a legitimate end, the burden imposed must be no more than is reasonably necessary, in that there must be an acceptable explanation or justification for the identified discriminatory treatment of trade and commerce between the [NAME] and [NAME]. That is to say, it is not necessary to show that the burden is absolutely necessary to achieve the [NAME] end. 67 Two overlapping ends had been identified by the State as being legitimate. They were as follows: funding the operation of [NAME] in [NAME] by means of taxes and charges imposed in respect of the sole offcourse [NAME] and betting business authorised to be conducted in [NAME]; and the regulation, control and restriction of offcourse betting, including [NAME] [NAME] and other betting, in [NAME]. The [NAME] judge found that the Impugned Provisions were not appropriate or adapted to any legitimate end.

Accordingly, [NAME] concluded that the Impugned Provisions offended s 49 of the Self-Government Act. 68 The State and [NAME] contend that the [NAME] judge erred in her conclusions concerning the application of s 49 of the Self-Government Act. Thus, three broad questions were raised in the appeals as follows: whether the placing and acceptance of wagers by means of [NAME], including associated financial transactions and the commercial arrangements for the installation of [NAME] in [COMPANY], constitute trade and commerce between the [NAME] and [NAME]; whether the prohibitions contained in the Impugned Provisions impose on that trade and commerce a discriminatory burden that is protectionist in nature; and whether any such burden is appropriate and adapted to a legitimate non-protectionist end. Before dealing with those questions, it is necessary to say something about the [NAME] legal principles.

[NAME] LEGAL PRINCIPLES 69 The establishment of a [NAME] by statute does not, of itself, engage s 92 of the Constitution or s 49 of the Self-Government Act. Where a statutory [NAME] exists, no person is permitted to compete with the monopolist. In such a case, the statute discriminates between the monopolist, on the one hand, and all others, on the other hand. It does not discriminate against trade or commerce between a [NAME] and a State (see [NAME]) v [NAME] (1990) 171 CLR 182). A licensing scheme does not prima facie discriminate against trade and commerce between [NAME] or between a [NAME]. Rather, it discriminates between the holders of a [NAME] and all others. Unless it can be shown that the practical operation of such a scheme is such that it can be inferred that the true purpose of the establishment of the scheme was to discriminate against trade and commerce between [NAME] or between [NAME], neither s 92 nor s 49 will be attracted. 70 Section 49 is not concerned with the individual rights of [NAME] that engage in trade or commerce that extends over State or [NAME] boundaries. It does not extend to a burden on trade or commerce in which an [NAME] engages or seeks to engage simply because that [NAME] happens to operate from, or have a place of business, outside the borders of the State or [NAME] that imposes the burden. It does not extend to a burden imposed by the law of a State or [NAME] simply because the burden affects competition between [NAME] in a national market, even if those [NAME] happen to be located on different sides of a State or [NAME] boundary ([COMPANY] v [NAME] (2008) 234 CLR 418 at [26] ([NAME]) and [COMPANY] v [NAME] (1990) 169 CLR 436 at 471 and 474 ([NAME]). 71 The new economy, both Australia-wide and worldwide, facilitates the ability of those who are physically located outside the geographical area of a particular jurisdiction to compete with those physically located wholly within the geographical area of that jurisdiction. That, in turn, has facilitated the development of national markets in circumstances where, previously, only local markets might have existed. Thus, the factual context within which s 49 operates has changed. Nevertheless, while the factual context has changed, the legal questions posed by s 49 remain the same. 72 The purpose of s 92 of the Constitution was the achievement of freedom of trade and commerce among the [NAME] that succeeded the former colonies. The purpose of s 49 of the Self-Government Act is the achievement of freedom of trade and commerce between the [NAME] and the [NAME]. However, it is necessary to identify the kinds of burdens, restrictions, controls and standards from which freedom is guaranteed by the provisions. Both s 92 and s 49 require only that trade and commerce be immune from discriminatory burdens of a protectionist kind. That is to say, the object of both s 92 and s 49 is the elimination of protectionism. Both provisions are designed to prevent the use of [NAME] boundaries as trade borders or barriers for the protection of [NAME] in a market, who are within a State or [NAME], from competition from [NAME] in that same market, who are not in that State or [NAME]. The means by which that object is achieved is a prohibition of measures that burden trade and commerce between [NAME] and that have the effect of conferring protection on [NAME] and commerce of the same kind ([NAME] (1988) 165 CLR 360 at 392-394 ([NAME]), [NAME] at [36]). 73 In considering the application of s 49 to a particular law, one must first consider the nature of that law. If, on its face, it applies to all trade and commerce, both between [NAME] and intrastate, it is less likely to be protectionist than if discrimination appears on its face. However, even if the law does not, on its face, discriminate in favour of intra-State trade, it will nevertheless offend s 49 if, in its effect, it discriminates in favour of intra-State trade and the discrimination is of a protectionist character. On the other hand, a law will not ordinarily be characterised as protectionist if its real object is the prescription of a standard for a product or service or a norm of commercial conduct for all [NAME] in a market ([NAME] v [NAME] at 408). 74 Even though a particular measure may unquestionably constitute a burden on trade and commerce between [NAME], of a particular kind, it will not necessarily bear the character of being discriminatory against that trade and commerce if the burden applies equally to [NAME] and commerce and to trade and commerce between [NAME]. If the burden created by the law does not give [NAME] and commerce a competitive or market advantage over trade and commerce between [NAME], there will be no offending against s 49 ([NAME] v [NAME] at 409). 75 A law will be discriminatory if it operates by reference to a distinction that some overriding law decrees to be irrelevant or by reference to a distinction that is, in fact, irrelevant to the object to be attained. Even if a law operates by reference to a [NAME] distinction, it will be discriminatory if the different treatment thereby assigned is not appropriate and adapted to the difference or differences that support that distinction. A law will also be discriminatory if, although there is a [NAME] difference, it proceeds as though there is no such difference. That is to say, a law will be discriminatory if it treats equally things that are unequal unless there is no practical basis for differentiation ([NAME] at 478). 76 Section 49 will not invalidate a burden on trade and commerce between [NAME] that disadvantages that trade in competition with [NAME], if the imposition of the burden is reasonably necessary or appropriate for the protection of the people of the State from a real danger or threat to its wellbeing. The question whether a particular legislative enactment is a necessary, or even a desirable, solution to a particular problem is, in large measure, a political question, best left for resolution by the political process. It would be intolerable for the judiciary to sit in judgment on a legislative decision, since to do so would give a new and unacceptable dimension to the relationship between the judiciary and the legislature. The judiciary would be placed in an invidious position if it were only such regulation of [NAME] trade as is, in fact, necessary for the protection of the community that was consistent with the freedom ordained by s 92 ([NAME] at 472-473). 77 Even if a measure is legitimately directed to a perceived threat to the integrity of an [NAME] in a State, the method of countering it must be non-discriminatory regulation. If the choice taken is not necessary for the protection of the integrity of that [NAME] in the State, in that prohibitions contained in the measure are not appropriate and adapted to guarding against the threat to the integrity of that [NAME] in a non-discriminatory manner, the provision will offend s 92 ([NAME] at [109]-[110]). Further, revenue protection cannot justify a law that discriminates against [NAME] trade, since such a justification, if allowable, would support the reintroduction of customs duties at [NAME] borders ([NAME] at [108]). 78 A measure may burden trade and commerce between [NAME], both directly and indirectly. It will do so directly if it denies to a [NAME] outside the State the use of an element in that [NAME]'s operations. It will do so indirectly if it denies to the customers of the out-of-State [NAME] receipt and consideration of information required by those customers that would otherwise be available to them by accessing the [NAME]'s website or by communication with its [NAME]. If such effects operate to the competitive disadvantage of the [NAME] outside the State and to the advantage of in-State [NAME], the measure may impose a discriminatory burden of a protectionist kind on trade between [NAME] ([NAME] at [118]). 79 A measure that prohibits [NAME] in a State from engaging in a particular form of transaction by means of a cross-border electronic communication and renders an out-of-State [NAME] liable for aiding or abetting an offence by [NAME] in the State, may be a discriminatory burden on [NAME] trade of a protectionist kind, even if all of the acts of the out of State [NAME] occur outside the State and that particular form of transaction is also denied to in-State [NAME] and their customers. However, such a measure will only be a discriminatory burden on [NAME] trade of a protectionist kind if it operates to protect established trading operations in the State from the competition that the out-of-State [NAME] would otherwise present. If the discrimination in a measure is between different but competing forms of transaction and the effect of the measure is to prohibit an out-of-State [NAME] from providing a service to persons in the State, leaving in-State [NAME] able to supply customers with their [COMPANY] without the competition to their revenue that the out-of-State [NAME] would present, the measure will impose a discriminatory burden of a protectionist kind ([NAME] at [120]-[122]). 80 Before there will be a contravention of s 49, it is necessary to point to a [NAME] differential treatment that is likely to discriminate in a protectionist sense between [NAME] and intrastate [NAME] transactions that employ technology such as [NAME] ([COMPANY] v [NAME] (2012) 286 ALR 221 at [31] ([NAME] v [NAME]). Not every measure that has an adverse effect between competitors will attract the operation of s 49. A measure will not contravene s 49 unless its practical effect is to discriminate against [NAME] trade and thereby protect [NAME] of the same kind ([NAME] at [11] and [NAME] v [NAME] at [36]). The concept of protectionism supplies the criterion by which discriminatory laws may be classified as rendering less than absolutely free trade and commerce among the [NAME] and between the [NAME] and the [NAME]. The requirement of protectionism is essential to the attraction of s 92 or of s 49 ([NAME] v [NAME] at [36]). 81 Emphasis upon the circumstances of particular [NAME], and upon features that may be accidental to those circumstances and to [NAME] transactions in which those [NAME] may engage, carries the risk of erroneously characterising an impugned law by its effect on particular [NAME] and not by its effect upon [NAME] trade ([NAME] v [NAME] at [46]). The subject of s 49 is trade between the [NAME] and the [NAME], not [NAME], whose transactions may or may not consist wholly of inter-State transactions or intra-State transactions ([NAME] v [NAME] at [50]). 82 The fact that a [NAME] has its principal place of operation in a State where its business receives protection by the law of that State does not necessarily lead to the conclusion that that [NAME] is engaged only in [NAME]. Where the [NAME] of a [NAME] is located in one state but it carries on, in other [NAME], the business of selling goods, the essence of which consists of the contracts with [NAME], the [NAME] should not be classified as being engaged in [NAME] ([NAME] v [NAME] at [48]-[49]).

APPLICATION OF SECTION 49 OF THE SELF-GOVERNMENT ACT 83 The declarations made by the [NAME] judge, which were the declarations sought by [NAME] and [APPELLANT], were that the Impugned Provisions are invalid to the extent that they apply to the installation and use in [NAME] by [NAME] and [APPELLANT] of the computer device known as a [NAME]. The basis for the invalidity is that they offend against s 49 of the Self-Government Act, in that they impose an impermissible burden on trade and commerce between the [NAME] and [NAME]. 84 Those declarations are specifically concerned with activities of [NAME] and [APPELLANT]. In concluding that, by accepting wagers by means of [NAME], [NAME] is engaged in [NAME], the [NAME] judge regarded several facts and matters as being critical. 85 Firstly, [NAME] is [NAME] in the [NAME] and has a [NAME] office and principal place of business in the [NAME]. However, the following facts make it clear that the real central control and management of [NAME]'s business is in [NAME]: [NAME] has a [NAME] office in Darwin, it has much larger offices in [APPELLANT]. A substantial part of [NAME]'s business is conducted in [APPELLANT], including its IT, marketing, human relations, finance and administration departments, its [NAME], the risk management department, real-time client bet monitoring and the fraud department, including anti-money laundering checking. The management of [NAME]'s business is conducted in [APPELLANT] and there is a far greater concentration of senior and other staff in [APPELLANT]. [NAME]'s senior managers spend most of their time in [APPELLANT] and are resident in [APPELLANT]. [NAME]'s [NAME] does not confer any right, and does not purport to confer any right, on [NAME] to engage in bookmaking activities in [NAME]. By installing [NAME] in [COMPANY] and its display of logos and advertising, [NAME] had a physical presence in [NAME] and, in substance, betting and [NAME] transactions occurred within [NAME]. 86 Secondly, [NAME] had regard to the fact that [NAME] has a [NAME] [NAME] business that operates from specific premises in the [NAME] under the [NAME] Act. Its [NAME] permits [NAME] a more flexible approach to marketing than other places in Australia. It permits [NAME] to offer a much wider range of bets to [NAME] than is permitted under [NAME] law. It permits [NAME] to provide credit to [NAME]. [NAME] cannot do that anywhere else in Australia. One of the conditions of [NAME]'s [NAME] is that [NAME] take bets from the [NAME] in Darwin. 87 In that regard, it is [NAME] that there is a developed market throughout Australia for the provision by [NAME] and totalisators, by means of telephone and the Internet, of [NAME] [COMPANY] on [NAME] and sporting events. Indeed, such a market may be international. Such events may take place in one State or [NAME], the [NAME] may be in another State or [NAME] and the [NAME] or [NAME] may be in a third State or [NAME]. The inhibition to competition presented by geographic separation between rival suppliers and between supplier and customer in such a market is reduced by the existence of the Internet and the ease of its use, together with other means of electronic communication, such as wireless telephones ([NAME] at [114]). 88 However, even if the facts and matters relied on by the [NAME] judge might lead to the conclusion that [NAME] is engaged in trade and commerce in a market that extends to the [NAME] and other parts of Australia and the world, including [NAME], that is not to the point. The question is whether the installation and use of [NAME] and the transactions that are undertaken by means of [NAME] constitute trade between the [NAME] and [NAME]. It is not sufficient to conclude that [NAME] is engaged in [NAME] between [NAME] and the [NAME]. It is necessary to consider whether the Impugned Provisions impose a [NAME] burden on that trade and commerce. 89 The [NAME] transactions that [NAME] says constitute the trade and commerce between [NAME] and the [NAME] that is burdened by the Impugned Provisions occur when a [NAME] places a wager with [NAME] using [NAME] in [COMPANY] in [NAME]. In those circumstances, the [NAME] is present in [COMPANY]; so is [NAME], by reason of the location of [NAME] in [COMPANY]. Thus, the [NAME] transactions occur between [NAME], through [NAME], and the [NAME], within [COMPANY] in [NAME]. The question is whether those transactions are properly to be characterised as trade and commerce between [NAME] and the [NAME]. That question is not answered by considering the business of [NAME] or the business of [APPELLANT] in broad terms. It is necessary to examine the precise conduct involved. 90 [NAME], located in [NAME], is the means whereby a customer of [NAME] places a wager with [NAME] in [NAME]. The fact that the wager is subsequently accepted or rejected in Darwin does not detract from the fact that [COMPANY] is a place of betting within the meaning of s 2.5.2(1)(a). [NAME], and the place where it is located within [COMPANY], are both places to which [NAME] resort for the purposes of [NAME] with [NAME]. The function and purpose of [NAME] at [COMPANY] is to enable [NAME] to accept instructions from [NAME] in [NAME] for the placing of bets with [NAME]. By installing [NAME] in [COMPANY], [NAME] has localised a stand or pitch where wagers were to be executed (see Bond v Foran (1934) 52 CLR 364 at 370). That stand or pitch is in [NAME]. 91 In so far as [NAME] engages in trade and commerce in a market that extends beyond the borders of the [NAME], it does so by means of the internet and other technology, such as personal computers and mobile telephones. Competition in that regard is fierce. However, s 49 does not afford [NAME] an immunity to conduct business as it pleases in [NAME] simply because there are some aspects of its activities that might fairly be characterised as trade and commerce that go beyond the boundaries of the [NAME] and might fairly be described as trade and commerce between the [NAME] and [NAME]. The Impugned Provisions do not prevent [NAME] from doing what it does in the [NAME] in accordance with its [NAME]. Nor do they prevent [NAME] from engaging in its business beyond the border of the [NAME] by means of the internet and other technology, such as personal computers and mobile telephones. 92 Finally, the [NAME] judge had regard to the fact that the significant part of [NAME]'s computer [NAME] is located in Darwin and that [NAME]'s customers, including customers in [NAME], interact with [NAME] through its computers located in the [NAME]. However, the facts summarised above demonstrate that the computer [NAME] and employees in the [NAME] operate under the control and management of the senior management of [NAME] located in [NAME]. The Impugned Provisions prohibit activities that are distinctly [NAME]. The use of [NAME] is essentially [NAME]. Any trade and commerce that is affected by the Impugned Provisions, including the installation and use of [NAME] in [COMPANY], occurs within [NAME]. 93 Accordingly, there are cogent reasons for concluding that the [NAME] judge erred in concluding that the installation and the use of [NAME] in [COMPANY], as described above, constitutes trade or commerce between the [NAME] and [NAME]. Having regard to the location in [NAME] of the management of [NAME], [NAME], [COMPANY] and a [NAME] who uses [NAME] in [COMPANY] for the purpose of making a wager or bet with [NAME], there are good grounds for concluding that it is trade and commerce wholly within [NAME]. The connection with [NAME]'s computer [NAME] in the [NAME] is no more than incidental to the particular transactions in question. It would follow that the Impugned Provisions impose no burden or restraint on trade and commerce between [NAME] and the [NAME]. 94 However, even if the particular conduct in question constitutes trade and commerce between the [NAME] and [NAME], the critical question is whether the Impugned Provisions constitute a burden of the [NAME] kind on that trade and commerce, namely, a discriminatory burden of a protectionist kind. The Impugned Provisions do not have a discriminatory effect in relation to [NAME] qua [NAME], because there is no competition between [NAME] and [NAME] on equal terms. [NAME] would have a huge advantage over [NAME] if it were allowed to operate [NAME] without having to bear all of the obligations undertaken by [NAME]. The obligations undertaken by [NAME] are the quia pro quo for all of the rights granted by its [NAME]. 95 Discrimination involves the unequal treatment of equals or the equal treatment of unequals (Bayside City Council v [COMPANY] (2004) 216 CLR 595 at 629-630). However, [NAME] is treated in precisely the same way as every other person in the world, other than [NAME]. [NAME] and [NAME] may be competitors, they are not equals. The grant of the [NAME] [NAME] to [NAME] was conferred only on the basis that [NAME] would accept substantial burdens, principally directed to the advancement of the [NAME]. Those burdens do not fall upon [NAME] or upon anybody else. [NAME] is sui generis. 96 It is not possible to conclude, simply from the differential treatment afforded to [NAME], by reason of its exemption from the Impugned Provisions, that the Impugned Provisions discriminate in favour of [NAME]. [NAME] is in a position relevantly different from all other [NAME], both [NAME] and [NAME]. It is the [NAME] of a [NAME] for which it paid approximately $600 million, being a [NAME] that grants to it the privilege of [NAME] exclusivity and offcourse [NAME] exclusivity. As a condition of the grant of that [NAME] and of the privileges that it entails, [NAME] was required to, and did, enter into arrangements that were satisfactory to [NAME], being arrangements that substantially fund [NAME]. [NAME] is subject to special and distinct regulatory requirements by reason of its status as the [NAME] of that [NAME]. The differences between the legislative treatment of [NAME], on the one hand, and the legislative treatment of all other [NAME], on the other, are a reflection of the value of the privileges for which [NAME] paid substantial consideration. 97 In their terms, the Impugned Provisions treat all [NAME] other than [NAME] equally, whether they are based in the [NAME] or [NAME] and whether they engage in trade and commerce between the [NAME] and [NAME] or [NAME] and commerce. [NAME] under the [NAME], no person can operate as [NAME] in [NAME]. If [NAME] under the [NAME], [NAME] may engage in such business while at a licensed race course in [NAME]. There is nothing to preclude [NAME] who wish to engage in trade and commerce between the [NAME] and [NAME], or who have connections with the [NAME], from becoming [NAME] under the [NAME]. However, even if so [NAME], no [NAME] other than [NAME], whether wholly [NAME] or otherwise, can conduct offcourse business by means of a service such as [NAME]. On the other hand, there is no prohibition on [NAME] receiving bets from persons located in [NAME] by means of telephone or personal computer and the internet. 98 If [NAME] or any other [NAME] based [NAME] sought to be [NAME] in [NAME], it would be in exactly the same position as all other [NAME] [NAME] in [NAME], other than [NAME]. The fact that the Impugned Provisions preclude [NAME] from conducting business in [NAME] by means of [NAME] is not of itself sufficient to engage s 49 of the Self-Government Act. [NAME] must demonstrate discrimination of a protectionist kind, not just an adverse effect on a particular aspect of its business. Section 49 does not protect the particular business model that a [NAME] seeks to employ. 99 If the requirement of the Impugned Provisions that all [NAME] conducting business in [NAME] must do so only at particular locations offended s 49, the consequence would be that the State could regulate where and how [NAME] can conduct their business in [NAME] but could not regulate where and how non-[NAME] can conduct their business in [NAME]. Section 92 of the Constitution, in its emanation in s 49 of the Self-Government Act, does not afford [NAME] an immunity to conduct business as it pleases in a State simply because it has a [NAME] in the [NAME] and it processes, on its computer [NAME] in the [NAME], [NAME] transactions that emanate from [NAME]. 100 The Impugned Provisions apply only if [NAME] seeks to establish a physical presence in [NAME], as [NAME] seeks to do by means of [NAME]. The question is whether, once [NAME] has a physical presence in [NAME], the requirement that the [NAME] be present at a racecourse, rather than some other place, is more difficult to meet for [NAME] than it is for [NAME]. There is no reason to suppose that it is. There is, therefore, no discrimination of a protectionist kind that affects trade and commerce between the [NAME] and [NAME]. 101 Protectionism is the economic policy of restraining trade from foreign competitors in order to shield [NAME] from the full rigours of that competition. The vice in such a policy is said to be that it discourages specialisation in areas of comparative advantage and fosters inefficiency. Protectionism ordinarily involves giving assistance to a specific inefficient domestic [NAME] to the detriment of a specific more efficient foreign [NAME]. That results in a loss to overall welfare. Motivation to engage in protectionism comes about from a perception that the protected [NAME] will add to the wellbeing of the domestic jurisdiction. 102 However, the Impugned Provisions impose a blanket prohibition. A prohibition that outlaws all trade in a market, both domestic and foreign, is not protectionist. If the prohibition attaches to all, no [NAME] and no intrastate [NAME] are being protected. The predecessors of the Impugned Provision could not be characterised as protectionist, since they applied to the whole world. There was no exception until the [NAME] was created. Neither s 92 nor s 49 could possibly be attracted unless an exception to the blanket prohibition was created. However, the mere creation of an exception does not render the prohibition protectionist. 103 The blanket prohibition of offcourse [NAME] was qualified when the [NAME] was established and was continued when the operations of the [NAME] were privatised in 1994 by being transferred to [NAME]. The privatisation did not simply involve granting a permit to a new private [NAME] to engage in offcourse [NAME]. The scheme that operated to prevent the use of [NAME] in [COMPANY] was established in 1994 for a defined and finite term, on specified conditions. The scheme then established included the following elements: [NAME] acquired a [NAME] [NAME] for a finite period, for which it paid a substantial consideration, replacing the [NAME] as sole provider of offcourse [NAME] [NAME] [COMPANY]. In taking on the [NAME] [NAME] and entering into mandatory related commercial arrangements, [NAME] became burdened by the obligation to make financial contributions to the [NAME] at a substantially higher effective rate than any other person or [NAME] and was also burdened by the need to operate a [NAME] as a core element of its [NAME] service, involving significant expense not borne by non-[NAME] [NAME] service providers. 104 The removal of one of the benefits afforded to [NAME], while retaining the corresponding burdens, would result in market distortion. [NAME] would have the benefit of the payments made by [NAME] to [NAME] without bearing the burden of making payments at the level that [NAME] is obliged to make such payments. [NAME] would take the benefit of [NAME]'s financial contribution to [NAME] without bearing an equal burden. The [NAME] exclusivity provisions that benefit [NAME] do not deny market access to persons who are more efficient than [NAME]. Rather, they prevent a market distortion that would be the consequence of permitting [NAME] to have the benefit of [NAME]'s ongoing payments to [NAME] without requiring such [NAME] to make an equal payment. 105 [NAME] contends that the Impugned Provisions necessarily target [NAME] trade because they prevent [NAME] from using [NAME] for communicating from [NAME] to the [NAME], in circumstances where [NAME] enjoys the liberty of concluding transactions through the means of its [NAME], which perform the same function. [NAME] asserts that the prohibition on using [NAME] as a means of carrying on its business in [NAME] demonstrates that the burden falls directly on [NAME] trade. [NAME] also points to [NAME] as being not merely a [NAME] but the single [NAME] that is capable of engaging in the form of communication that is otherwise unlawful. [NAME] is not subject to the prohibition contained in the Impugned Provisions and can communicate with its [NAME] customers by means of [NAME]. 106 However, in so far as the Impugned Provisions prohibit communicating, not only do they prohibit communication from a place in [NAME] to the [NAME], they prohibit communication from any place in [NAME] to any other place in [NAME]. The [NAME] prohibition is not on communicating by means of [NAME], but on possessing in [NAME] an instrument of betting in the form of a [NAME], on opening, keeping or using in [NAME] a [NAME], and on allowing [NAME] to bet on licensed premises in [NAME]. 107 [NAME]'s contentions emphasise the real gravamen of its complaint. Its complaint is directed not so much at the Impugned Provisions as at the exemptions granted to [NAME] by reason of its [NAME]. [NAME]'s true complaint is that an [NAME], namely [NAME], is given a preference that is not given to any other [NAME], whether [NAME] or intrastate. The real complaint of [NAME] is that an exception to the long-standing prohibition imposed by the Impugned Provisions was created by the grant of a [NAME] to [NAME] to engage in offcourse [NAME] activities. That exception was created more than 50 years ago, in favour of the [NAME], [NAME]'s predecessor. [NAME] says, in effect, that, simply because its manner of doing business involves an element that happens to take place in the [NAME], albeit that it could take place in [NAME], it should be exempted from complying with the Impugned Provisions so that it can compete with [NAME] on a privileged basis. [NAME], in effect, seeks to be given a privilege that is not available to any intrastate [NAME]. 108 Thus, whether or not the activities of [NAME] that are prohibited by the Impugned Provisions could fairly be characterised as trade or commerce between the [NAME] and [NAME], the prohibitions of the Impugned Provisions do not constitute a discriminatory burden of a protectionist kind. Section 49 is not attracted by any of the Impugned Provisions. In the light of that conclusion, it is not necessary to consider whether any burdens imposed by the Impugned Provisions were appropriate and adapted to achieve legitimate ends. 109 Some months after these reasons were first formulated, the decision in [NAME] v [NAME] (No 6) [2012] FCA 896 was published, on 21 August 2012. The parties sought and were granted leave to make further brief written submissions in the light of that decision. It was recognised in that decision that the entitlements that [NAME] enjoys are not because it is an intrastate [NAME] but because of the obligations that it undertook to make substantive contributions to the [NAME] in return for rights correlative to those contributions (at [126]). [NAME] does not enjoy [NAME] exclusivity because it is an intrastate [NAME], but rather because of its [NAME] and the obligations imposed on it by the statutory scheme under which the [NAME] is granted. No [NAME] is prohibited from engaging in any conduct by the Impugned Provisions simply by reason of the fact that it is an [NAME]. The reasoning in the decision, if anything, supports the position of [NAME] and [NAME].

CONCLUSION 110 The Impugned Provisions do not impose a discriminatory burden of a protectionist kind. They impose a restraint on all who wish to engage in certain kinds of [NAME] activity, other than [NAME]. Their effect is to give to [NAME] both [NAME] exclusivity and [NAME] exclusivity in certain kinds of [NAME] activity. However, the restraints do not have the effect of interfering with trade or commerce between the [NAME] and [NAME] in a way that constitutes a discriminatory burden of a protectionist kind. The Impugned Provisions do not offend against s 49 of the Self-Government Act. The [NAME] judge erred in reaching her conclusion to the contrary. 111 Both appeals should be upheld. In lieu of the orders made by the [NAME] judge, there should be orders that the proceeding be dismissed and that the applicants in the proceeding pay the costs of the respondents to the proceeding, except for costs that were the subject of orders for costs made by the [NAME] judge from which there was no [NAME]. [NAME] should pay the costs of [NAME] and [NAME] of their respective appeals. I certify that the preceding one hundred and eleven (111) numbered paragraphs are a true copy of the Reasons for Judgment herein of the [NAME].

Associate: Dated: 12 October 2012 IN THE FEDERAL COURT OF AUSTRALIA [APPELLANT] 1000 of 2011

ON [NAME] FROM THE FEDERAL COURT OF AUSTRALIA

BETWEEN: [NAME]

Appellant

AND: [COMPANY] (ABN 87 [PHONE])

[APPELLANT] 135 267 597)

[APPELLANT]

[COMPANY] (ABN 66 [PHONE])

[APPELLANT]

THE [NAME] COMMISSION FOR [APPELLANT]

[APPELLANT] 1002 of 2011

ON [NAME] FROM THE FEDERAL COURT OF AUSTRALIA

BETWEEN: [COMPANY] (ABN 66 [PHONE])

Appellant

AND: [COMPANY] (ABN 87 [PHONE])

[APPELLANT] 135 267 597)

[APPELLANT]

[NAME] [APPELLANT]

THE [NAME] COMMISSION FOR [APPELLANT]: [NAME], [APPELLANT] AND [NAME]: 12 OCTOBER 2012 PLACE: [APPELLANT] FOR [NAME] AND [NAME] [112]

DECISION OF THE [NAME] JUDGE [121] THE IMPUGNED PROVISIONS [129] Section 2.5.2 of the [NAME] [129] Section 2.6.1 of the GRA – Possession of Instrument of Betting [134] Section 115 of the LCRA – Betting on licensed premises [135] [NAME]'s exemption from the prohibitions in the impugned provisions [137] FACTUAL

BACKGROUND [140] Economic, social and cultural significance of the [NAME] [142] Brief history of [NAME]'s exemption from the [NAME] prohibitions [145] The business of [NAME] [164] [NAME] [167] [NAME] [169] [NAME] and the current funding of the [NAME] [172] Alternative models for funding the [NAME] [186] The business of [NAME] [189] [NAME] [195] [NAME] [199] OVERVIEW OF [NAME] [204] [NAME] [208] [NAME], [NAME] and [NAME] [216] The [NAME] cases [225] QUESTIONS TO WHICH THE [NAME] [243] Discrimination against trade or commerce between the [NAME] [244] Trade or commerce between the [NAME]? [244] The nature of the burden [259] Discrimination against [NAME] – State trade [262] A statutory [NAME] is not per se discrimination against out-of-state trade [279] Protectionism – disadvantaging out-of-state trade or advantaging [NAME]? [287] Protectionism – Not reasonably necessary to achieve a legitimate purpose? [[NAME]] Reasonably necessary for the promotion of a [NAME] [NAME], including for the purpose of funding the [NAME] [307] DISPOSITION [322]

INTRODUCTION 112 These are two appeals from a judgment of a single judge of the Court. For the reasons stated below, we would allow both appeals. 113 The appeals raise the question whether ss 2.5.2 and 2.6.1 of the Gambling Regulation Act 2003 ([NAME]) (GRA) and s 115 of the Liquor Control Reform Act 1998 ([NAME]) (LCRA) (together, the impugned provisions) are invalid to the extent that they purport to apply to the installation and use in [NAME] by [APPELLANT] ([NAME]) and [APPELLANT] [COMPANY] ([APPELLANT]) of a computer device known as a "[NAME]". Section 2.5.2 of the GRA prohibits [NAME] from opening, keeping or using a [NAME]. Section 2.6.1 of the GRA prohibits [NAME] from possessing an instrument of betting not authorised under the GRA. Section 115 of the LCRA prohibits a [NAME] under the LCRA from allowing [NAME] to bet on licensed premises. A [NAME] is a computer terminal that allows the [NAME], by means of a touch screen, to select and place a bet with [NAME] and to receive notification of its acceptance, by electronic communications to and from [NAME]'s servers: see [COMPANY] v [NAME] (2011) 282 ALR 423 ("[NAME]") at 426 [2] and 434 [40]. The effect of the impugned provisions is to prohibit [NAME] from installing a [NAME] device at premises in [NAME]. 114 [NAME] are, in [NAME] 1000, [NAME] (the State) and, in [NAME] 1002, [APPELLANT] ([NAME]). [NAME], the [APPELLANT] in both appeals, is a company licensed under the [NAME] Act 1983 (NT) ([NAME])) to operate as a sports [NAME] from premises in Darwin. [NAME]'s servers are located at its licensed premises. 115 The litigation resulting in these appeals arose out of events between May and July 2010. In May 2010, [NAME] installed a [NAME] at the [APPELLANT] ([COMPANY]) in East Ballarat in [NAME]. [APPELLANT], the second [APPELLANT] in both appeals, is the [NAME] of [COMPANY]. In July 2010, officers of the [NAME] Commission for Gambling Regulation ([NAME]) seized [NAME] under s 10.5.9(1)(c) of the GRA, which enabled them to seize equipment if they considered this necessary for the purpose of obtaining evidence of the commission of an offence. The [NAME] offences were breaches of the impugned provisions. 116 As a consequence, [NAME] and [APPELLANT] instituted proceedings against the State and the [NAME]. [NAME] was subsequently granted leave to intervene and was later joined as a [APPELLANT]. 117 [NAME] is the [NAME] of a sole [NAME] [NAME] (the [NAME] [NAME]), pursuant to which [NAME] conducts [NAME] (pari-mutuel) and fixed odds betting on horse, harness and greyhound races. [NAME] accepts bets in various ways, including through "[NAME]" terminals. Provided that it complies with the [NAME] [NAME], [NAME] is exempt from the impugned provisions. [NAME] is said to enjoy "off-course [NAME] exclusivity". The exclusivity is said to be "off-course" because, subject to the [NAME] 1958 ([NAME]) ([NAME]), [NAME] "on-course" can also take bets, as discussed below. 118 The key question in these appeals arises by virtue of the operation of s 49 of the [NAME] (Self-Government) Act 1978 (Cth) (the Self-Government Act) and s 109 of the Commonwealth Constitution (the Constitution). 119 Section 49 of the Self-Government Act provides that: Trade, commerce and intercourse between the [NAME] and the [NAME], whether by means of internal carriage or ocean navigation, shall be absolutely free. Section 109 of the Constitution provides that: When a law of a State is inconsistent with a law of the Commonwealth, the latter shall prevail, and the former shall, to the extent of the inconsistency, be invalid. When read with s 109 of the Constitution, s 49 of the Self-Government Act (s 49) replicates the operation of s 92 of the Constitution (s 92) in relation to trade and commerce between the [NAME] and the [NAME] (the [NAME]), save that s 109 renders a legislative provision inconsistent with s 49 inoperative, rather than invalid, "to the extent of the inconsistency": compare [COMPANY] v [NAME] (2012) 286 ALR 404 ("[NAME]") at 408-410 [9]-[13]. In [NAME] v [NAME] (1999) 199 CLR 160 ("[NAME] v [NAME]"), the High Court held that s 49 is "to be given an ambulatory interpretation to follow the course of decisions construing s 92": see [NAME] v [NAME] at 175-176 [36] per [NAME] [NAME], [NAME] and [NAME] [NAME], 211-212 [152]-[153] per [NAME] and 232-233 [221] per [NAME[NAME]. 120 The question for determination in both appeals is whether the impugned provisions are rendered inoperative by s 109 of the Constitution by reason of their inconsistency with s 49 of the Self-Government Act. The fact that the impugned provisions apply to [NAME]'s use of a [NAME] at licensed premises in [NAME] but do not apply to [NAME]'s use of [NAME] at licensed premises is the basis of the claim that the impugned provisions offend s 49.

DECISION OF THE [NAME] JUDGE 121 At first instance, [NAME] and [APPELLANT] submitted that, on their proper construction, the impugned provisions did not apply to the installation and use of a [NAME]. The learned [NAME] judge rejected this submission and held that the impugned provisions applied to the installation and operation of [NAME] at [COMPANY]. This was because: (a) [NAME] was an "instrument of betting", within the meaning of s 2.6.1 of the GRA, being "not merely the means by which the bet is communicated", but "the means by which the bet is selected, placed and its acceptance is notified": see [NAME] at 434 [40]. (b) [NAME] and [COMPANY] in which it was located were both "places to which [NAME] resorted for the purpose of betting with [NAME]": [NAME] at 439 [66]. [NAME] held that, "[b]y installing the '[NAME]' in [[COMPANY]], [NAME] had localised a place as the stand or pitch where the bets were executed". [NAME] at 439 [64].

Accordingly, by installing and using a [NAME] at [COMPANY], [NAME] and [APPELLANT], opened, kept or used a "betting house or place of "betting" within s 2.5.1(1)(a) of the GRA and, for similar reasons, also fell within s 2.5.1(1)(b) and (d) of the GRA: see [NAME] at 439 [63]-[68]. (c) under the LCRA, [APPELLANT] was the [NAME] of a licensed premises – [COMPANY] – where [NAME] and [APPELLANT] installed [NAME] that enabled [COMPANY]'s patrons to bet with [NAME] in contravention of s 115(1) of the LCRA: see [NAME] at 440 [70]-[71]. 122 On [NAME], neither [NAME] nor [APPELLANT] challenged the [NAME] judge's rulings on the construction issues. Nor did they challenge [NAME]'s ruling that [NAME]'s approval to conduct fixed odds betting was a valid approval under s 4.5.3 of the GRA: see [NAME] at 427 [7], 460-463 [161]-[172]. 123 As well as arguing at [NAME] that, as a matter of statutory construction, the use of [NAME] at [COMPANY] did not contravene the impugned provisions, [NAME] and [APPELLANT] contended that the effect of the impugned provisions was contrary to the requirement in s 49 of the Self-Government Act that trade and commerce between the [NAME] and the [NAME] be absolutely free and that, in consequence, the impugned provisions were invalid (presumably, in the sense of inoperative) by reason of s 109 of the Constitution. 124 The [NAME] judge accepted this submission: see [NAME] at 427 [7]. [NAME] ruled that the impugned provisions were inconsistent with s 49 and invalid to the extent that they would preclude the operation of [NAME] at [COMPANY], because: (a) [NAME] was engaged in trade and commerce between the [NAME] (443-445[85]-[93]); (b) the impugned provisions imposed burdens on trade and commerce between the [NAME] (446 [95], 448-449 [108], 449 [110]); (c) these burdens were discriminatory because they did not apply to [NAME] (447 [101], 449 [109], 449 [110]); (d) these burdens were also protectionist because they conferred a competitive advantage on [NAME] over its [NAME] competitors and imposed a competitive disadvantage on [NAME] (451 [123], [125]); (e) the impugned provisions could not be justified as no more than an appropriate and adapted means to a legitimate end – funding the [NAME] and integrity – because: (i) "the evidence did not disclose whether the funding of [NAME] was presently adequate, inadequate or in excess of what was "adequate" (455 [141], emphasis in original); (ii) "the evidence did not establish what was the necessary level of funding, and whether that level of funding could only be secured by maintenance of the impugned provisions" (455 [141], 457 [149], 458 [150]); (iii) "much of the evidence adduced by [the State and [NAME]] was historical" [but] "the [NAME] date for construing the impugned provisions is the date when the "[NAME]" was removed by the [NAME], being the event which underpinned the constitutional challenge" (456 [144]); (iv) the protection of revenue (including returns to [NAME]) was not a legitimate, non-protectionist purpose (456-457 [145]-[146]); (v) the State and [NAME] did not adduce "any evidence about integrity concerns [to] which the impugned provisions were said to be directed" (459 [158]); (vi) the [NAME] for the State ([NAME] [NAME]) "gave evidence that although he considered that an integrity risk exposure existed, in his 30 years experience he could not recall any integrity failure with any corporate [NAME] in the [NAME] or any other corporate [NAME]" (459 [158]); (vii) integrity concerns "could be appropriately regulated without resorting to the blanket prohibition contained in the impugned provisions" (459-460 [159]); and (viii) security concerns about the physical aspects of [NAME], including its weight, access to the internet) and "the differences in responsible gambling regimes as between [NAME] and the [NAME] … could be appropriately regulated without blanket prohibition" (460 [160]). 125 Regarding the funding of [NAME], the [NAME] judge concluded (at 458 [151]): The respondents have failed to establish that the burden that the impugned provisions impose on [NAME] is appropriate and adapted to achieving the funding objective or even the broader objective of promoting a vibrant and [NAME] [NAME], including by materially funding that [NAME] through the [NAME], which generates a [NAME], commission-based and adequately high source of revenue that is not contingent on outcomes. The respondents did not establish that the impugned provisions are capable of being seen as likely to achieve those identified purpose(s) and, further, did not establish that there were no alternative means to achieve those identified purpose(s) which involve no, or a lesser, burden on [NAME] than the means adopted. Put another way, there was no evidentiary basis to make the necessary findings that the funding of [NAME] was imperilled by the striking down of the impugned provisions. That conclusion is not surprising. [NAME] can use a mobile phone in a public bar to place a bet with [NAME] but cannot use a "[NAME]". 126 The [NAME] judge also rejected the contention that identified security and integrity concerns justifying the prohibitions contained in the impugned provisions, for the reasons referred to in para [124] (e) (v) – (viii) above. In substance, [NAME] held (at 427 [7]) that: The impugned provisions are a burden because in their legal and practical operation they establish [NAME] as a [NAME] provider of off-course betting [COMPANY] in [NAME] in what is a national market for the supply and acquisition of off-course betting [COMPANY]. It was not demonstrated that the impugned provisions were no more than an appropriate and adapted means to a legitimate end. The [NAME] judge made declarations consistent with this ruling and consequential orders, including an order for the [NAME] to return [NAME] to [APPELLANT]. 127 The State and [NAME] have appealed against the whole of [NAME]'s judgment upon grounds, which, if accepted, would establish that the impugned provisions were not inconsistent with s 49 of the Self-Government Act and applied to prohibit [NAME] and [APPELLANT] from installing and using [NAME] at [COMPANY]. [NAME] and [APPELLANT] have sought to uphold [NAME]'s declarations as to invalidity. In each [NAME], the [NAME] entered a submitting appearance, save as to costs. 128 Before we examine the arguments advanced by the parties, it is necessary to consider the legislative and factual context of the present case in more detail.

THE IMPUGNED PROVISIONS

Section 2.5.2 of the [NAME] 129 Section 2.5.2(1) of the GRA relevantly provides: [NAME] must not— (a) open, keep or use a [NAME]; or (b) being the [NAME] of a house or place, knowingly and wilfully permit it to be opened, kept or used by any other person as a [NAME]; or (c) have the care or management of, or in any manner assist in conducting the business of, a [NAME]. 130 The terms "betting house" and "place of betting" are defined in s 2.5.1(1) of the GRA as: a house or place (as the case requires) that is opened, kept or used— (a) for the purpose of betting with any persons (whether in person or by messenger, agent, post, telephone or otherwise); or (b) for the purpose of taking instructions for the placement of bets on behalf of any person; or (c) for the purpose of any money or valuable thing being received by or on behalf of [NAME]— (i) as or for the consideration for any undertaking to pay or give thereafter any money or valuable thing on any sporting event; or (ii) as or for the consideration for securing the paying or giving by some other person of any money or valuable thing on any such event— except for the purpose of paying or receiving money in settlement of bets lawfully made under the [NAME] 1958 or this Act by or on behalf of a [NAME]; or (d) for the purposes of printing, duplicating or producing lists of persons, animals or things (however identified) for the purpose of such lists being used for or in connection with unlawful betting on a sporting event. 131 Relevantly, "place" is defined as any place, whether or not within a building, on land or water, defined as to area, or on private property, and a "[NAME]" as the [NAME] of a current certificate of registration as a [NAME] under Pt 5A of Ch 4 of the GRA: see, respectively, ss 2.1.2(1) and 1.3(1). 132 The exception in s 2.5.1(1)(c) picks up s 4 of the [NAME], which provides that a [NAME] may, in certain circumstances, take bets on horse, harness or greyhound races (or certain other events) without contravening the GRA. Section 4 provides that: (1) Despite anything in the Gambling Regulation Act 2003 (except Divisions 5 and 6 of Part 5 of Chapter 4) or any other law, it is not a contravention of that Act or law, and a racecourse is not a [NAME] for the purposes of that Act, if [NAME] bets by way of [NAME]— (a) on any horse race, harness race or greyhound race; or (b) on any approved betting event; or (c) on a group of races approved by the Minister under section 2.5.16(1)(b) of the Gambling Regulation Act 2003 or on a race from such a group of races— in accordance with this section. (2) The racecourse must be licensed under this Part. (3) The bet must be made— (a) with a [NAME]; or (b) with an approved substitute— who is present on the racecourse at the time the bet is made. (4) The bet must be made— (a) during the holding of a race meeting at the racecourse by [NAME] present on the racecourse; or (b) at any time by [NAME] not present on the racecourse using a method of communication approved by the Minister under section 4A. (5) In this section, a reference to a racecourse licensed under this Part includes a reference to land otherwise authorised for the holding of race meetings under this Part or Part III. 133 That is, broadly speaking, a [NAME] will not contravene the GRA or the [NAME] by taking bets on certain events (as stated in s 4), including horse, harness or greyhound races, where the [NAME] accepts a bet when present on an authorised racecourse when the bet is made: (1) during a race meeting at the racecourse, from [NAME] who is also on the racecourse; or (2) at any time, from [NAME] who is not at the racecourse, by means of an approved method of communication. A racecourse, within the meaning of s 4 of the [NAME], is a racecourse in [NAME]: see Interpretation of Legislation Act 1984 ([NAME]), s 48(b).

Section 2.6.1 of the GRA – Possession of Instrument of Betting 134 Section 2.6.1(1) of the GRA provides that "[a] person must not possess an instrument of betting not authorised under this Act". The term "instrument of betting" is defined in s 2.1.2(1) as including: (a) a document; (b) a card, list, money, paper, record, sheet, table, ticket or other written document; (c) a mechanical, electrical, telephonic, electronic or other equipment or device or any access to such equipment or device; (d) a board, chart or screen; or (e) any form or means of recording, storing or transmitting information or data— used, apparently used or likely to be used in carrying on or in connection with betting on a sporting event (being betting that is not authorised by a gaming Act or any other Act). The expression "gaming Act" is defined to mean the GRA or the [NAME] ([NAME]): see GRA s 1.3(1). "Possession" (as defined in s 2.6.1(2)) includes: (a) actual physical possession; and (b) custody or control; and (c) having and exercising access, either solely or in common with others— and an instrument of betting is in [NAME]'s possession if it is on land or in premises occupied, used or controlled by the person.

Section 115 of the LCRA – Betting on licensed premises 135 Section 115 of the LCRA provides that: (1) A [NAME] or permittee must not bet or allow [NAME] to bet on the licensed premises or any authorised premises. Penalty: 20 penalty units. (2) Subsection (1) does not apply to betting on licensed premises or on any authorised premises— (a) if— (i) the premises are on a licensed racecourse within the meaning of the [NAME] 1958; and (ii) the betting is engaged in during the holding of a race meeting within the meaning of that Act on the licensed racecourse; or (b) if— (i) a betting facility of the [NAME] or the [NAME] under Chapter 4 of the Gambling Regulation Act 2003 is established in the premises; and (ii) the betting takes place through that [NAME] [NAME] or [NAME]; or … . 136 In summary, the impugned provisions preclude all [NAME] in [NAME] except [NAME] (as to which, see below) from engaging in off-course betting, including by means of a [NAME] or similar device. [NAME] apart, providing [NAME] is [NAME] under the GRA, the [NAME] may take bets in [NAME] but only in the circumstances stated in s 4 of the [NAME]. [NAME] is not [NAME] under the GRA and cannot take bets in [NAME]. If it were [NAME], then [NAME] would be in the same position in [NAME] as other [NAME]. As it happens, [NAME] has not sought registration under the GRA, although it could do so.

[NAME]'s exemption from the prohibitions in the impugned provisions 137 The effect of s 4.2.1(2) of the GRA is that a place in which [NAME] or an approved betting competition is conducted by [NAME] or its wholly owned subsidiary, [COMPANY] ([NAME]), is not to be characterised as a [NAME]. This provision thus takes such a place outside the scope of certain offences concerned with common gaming houses or places: see GRA, Pt 5, Div 6. Further, the effect of s 4.2.1(2) and the extended definition of "[NAME]" in s 2.5.20(1)(a)(iii) is also to take [NAME] outside the scope of s 2.5.2. Hence, [NAME] enjoys a "[NAME] presence" in [NAME] that is not enjoyed by other [NAME]. 138 By virtue of s 4.3.1, the [NAME] [NAME] authorises [NAME] to conduct [NAME] and approved betting competitions, subject to the [NAME] legislation and [NAME] conditions. Providing that [NAME]'s use of [NAME] is in accordance with s 4.3.1, then [NAME] is acting lawfully pursuant to s 4.2.1 and not in breach of s 2.6.1. 139 The effect of s 115(2) of the LCRA (see par [135] above) is to exempt [NAME] from the prohibition in s 115(1) of the LCRA. Thus, by reason of s 115(2), betting at licensed premises in [NAME] will not be unlawful by reason of s 115(1) if the betting is conducted with [NAME] or [NAME] through a betting facility of [NAME] or [NAME] at the premises.

FACTUAL

BACKGROUND 140 In the following discussion, it is helpful to bear in mind the nature of an [NAME] in this Court. Such an [NAME] is by way of rehearing: see [NAME] v [NAME] (2001) 205 CLR 507 at 533 [75] and [COMPANY] v [NAME] (No 2) [COMPANY] (2001) 117 FCR 424 ("[NAME]") at 434-435 [20]. With respect to an [NAME] of this kind, the Court is obliged to "give the judgment which in its opinion ought to have been given in the first instance": Dearman v Dearman (1908) 7 CLR 549 at 561, quoted with approval in [NAME] v [NAME] (2003) 214 CLR 118 ("[NAME] v [NAME]") at 125 [23], where, in explaining the duty of an appellate court, [NAME] [NAME], [NAME] and [NAME] [NAME] said (at 126-127 [25]): Within the constraints marked out by the nature of the appellate process, the appellate court is obliged to conduct a real review of the [NAME] and, in cases where the [NAME] was conducted before a judge sitting alone, of that judge's reasons. … In [NAME] v [NAME] [(1979) 142 CLR 531 at 551], the majority of this Court reiterated the rule that: "[I]n general an appellate court is in as good a position as the [NAME] judge to decide on the proper inference to be drawn from facts which are undisputed or which, having been disputed, are established by the findings of the [NAME] judge. In deciding what is the proper inference to be drawn, the appellate court will give respect and weight to the conclusion of the [NAME] judge but, once having reached its own conclusion, will not shrink from giving effect to it." As this Court there said, that approach was "not only sound in law, but beneficial in … operation". (Citations mostly omitted) 141 On these appeals, [NAME] did not contest the specific findings of fact that the [NAME] judge made. Instead, they contested the inferences that should properly be drawn from them, the undisputed facts and certain other evidence adduced at [NAME]. No party sought to argue that any assessment of credibility played any real part in [NAME]'s evidentiary appraisals or conclusions on questions of fact or mixed fact and law. All parties invited the Court to consider as a whole the evidence adduced at [NAME] – a task that, as appears below, proved to be unavoidable, having regard to the parties' submissions upon which the Court must rule.

Economic, social and cultural significance of the [NAME] 142 The [NAME] judge described the [NAME] as "[NAME] and prestigious", as the foremost in Australia, and among the best in the world: see [NAME] at 453 [134] and 457 [148]. In the words of a former Chair of [NAME], [NAME], the [NAME] is "a leader within the thoroughbred [NAME] in Australia, with premier racecourses and facilities attracting high quality trainers and [NAME] [NAME] from around Australia and internationally". On account of its success and international prestige, the [NAME] benefitted not only the State but also the [NAME] and [NAME] industries as a whole. 143 The evidence at [NAME] showed, and the [NAME] judge accepted, that [NAME] contributed to the economy, [NAME] and employment of the State: see [NAME] at 453 [134]. Indeed, [NAME] has played a significant role in the social and cultural life of [NAME] since European settlement: see [NAME[NAME], A Mug's Game. A History of Gaming and Betting in Australia ([NAME[COMPANY], 1988); [NAME[NAME], A Century Galloped By. The First Hundred Years of the [NAME] ([NAME], 1988); [NAME] (ed), They're [NAME]! The Complete Story of [NAME] ([COMPANY], 1999). Race meetings have a social and cultural significance for both metropolitan and regional [NAME]. In regional areas, they frequently contribute to the maintenance of local community identity. [NAME] is a popular recreation in the State and contributes to the economy through capital investment, employment and tourism. 144 Like other forms of gambling, however, participation in race [NAME] has a recognized potential for societal injury. [NAME] and race [NAME] are considered susceptible to corruption. As recently as August 2008, following a review sought by the [NAME] Minister for [NAME], Judge GD Lewis AM reported that "[i]t has been well known, for many years, that relationships exist between those involved in organised crime and [NAME]" and that "[NAME] is fertile ground for dishonesty and illegal manipulation, if it is not properly controlled": see [NAME] GD, A Report on Integrity Assurance in the [NAME], 1 August 2008, pp 18, 25.

Brief history of [NAME]'s exemption from the [NAME] prohibitions 145 [NAME]'s position under the State's current legislation is the outcome of the history of [NAME] and gaming regulation in the State. Its position is, therefore, most readily understood by a brief reference to this history. 146 By the late 1950s, off-course [NAME] in [NAME], though unlawful, was widespread. In 1958, the [NAME] appointed Justice FRB Martin as a [NAME] to inquire whether off-course [NAME] should be legalised and, if so, by what method. Justice Martin's report, published in 1959, recommended the establishment of an off-course [NAME] for off-course [NAME] in [NAME]. Justice Martin considered that a [NAME] would be better able to protect the integrity of [NAME] than other proposed methods for regulating off-course [NAME], and would generate revenue for the State and the [NAME] clubs. For Justice Martin, the critical difference between [NAME] and fixed odds betting was that, in contrast to fixed odds betting, the [NAME] [NAME] would take out its share from the [NAME] of bets before ascertaining the payout at the end of the race and, in consequence, the [NAME] would be indifferent to the result of the race. It was this factor that he considered likely to reduce the risk of interference with a race. Justice Martin's report stated that an off-course [NAME] [NAME]: would be the one which would give most satisfaction to the community generally, because of the absence of any striving for private gain, of any motive to corrupt police, [NAME] or the connexions of horses, or to interfere with the horses themselves and also because there would be no evasion of tax. (Report of the [NAME] appointed to inquire into off-the-course betting, together with minutes of evidence, [APPELLANT], ordered by the [NAME] to be printed 3 March 1959, p 53) 147 In response to Justice Martin's report, the [NAME] enacted the [NAME] ([NAME]) Act 1960 ([NAME]). This Act created the [NAME] Board ([NAME]) as a statutory body corporate to operate an off-course [NAME]. As a result, up until 1994, off-course betting could only be lawfully conducted through the [NAME]. From its establishment until the 1990s, the net profits of the [NAME] were distributed to [NAME] race clubs: see [NAME] at 454 [138]. As the [NAME] judge found, "[t]he possibility of funding the [NAME] through contributions from [NAME] was one of the reasons for establishing a government owned off-course [NAME] agency board": see [NAME] at 454 [137] (emphasis in original). 148 In 1994, the [NAME] decided to float the [NAME] as a public company. In order to do so, the Government entered into negotiations with [NAME] as represented by its controlling bodies. The outcome was a Memorandum of Understanding between the State and representatives of [NAME] dated 15 March 1994 (MOU). A purpose of the MOU was, as the MOU stated, "to secure the financial strength and future of [NAME]". By the MOU, the parties also stated that they would co-operate to establish a joint venture. 149 [NAME] was incorporated later in 1994, as the [NAME] to purchase the businesses conducted by the [NAME] and to acquire the [NAME] and gaming licences needed to conduct these businesses. In the same year, the Gaming and Betting Act 1994 ([NAME]) ([NAME]) was enacted. In the Treasurer's Second Reading Speech on 28 April 1994, the Treasurer stated (at 1314): New arrangements have been entered into with [NAME] designed to secure the financial health of the [NAME] and to provide for a large degree of self-determination in relation to [NAME] and [NAME]. … The government will maintain regulation in respect of matters of public interest and probity. The [NAME] will have a participating interest in the [NAME] [NAME] and gaming operations of the privatised [NAME] through a proposed joint venture, providing a more secure level of income into the future than would be available under a continuation of the current arrangements. 150 The [NAME] provided for the grant to [NAME] of a single [NAME] to conduct [NAME] (i.e., pari-mutuel betting on horse, harness and greyhound races) and approved betting competitions, and a single [NAME] to conduct gaming: see [NAME], ss 6, 7, 8, 11, 12, 13. Both licences were for a term of 18 years: see s 12(2). The [NAME] in Council was to grant the licences, subject to the recommendation of the [NAME] Authority (VCGA): see s 12(1). Before making the recommendation in [NAME]'s favour, the VCGA was required to be satisfied of various matters, including that [NAME] and [COMPANY] ([NAME]) had concluded a joint venture agreement: see [NAME], s 11(2)(e). There were other provisions also directed to ensuring the integrity and probity of the [NAME] [NAME] and its operations: see, e.g., ss 11, 27 and 53. 151 The [NAME] provided that, notwithstanding any law to the contrary, "the conduct of [NAME] and approved betting competitions is lawful when conducted in accordance with a [NAME] … granted under this Act": see [NAME], s 68(1). There were numerous other provisions governing the conduct of the [NAME]'s business: see, e.g., ss 69, 70, 71, 72, 73, 76. 152 On 25 May 1994, [NAME] entered into a Joint Venture Agreement (JVA) with [NAME] representing the [NAME]. The JVA entitled [NAME] to a 25% interest in the profits generated by [NAME]'s conduct of the gambling activities previously undertaken by the [NAME]. Additionally, [NAME] entered into other agreements, a Product Supply Agreement and a [NAME]. These two agreements enabled the principal [NAME] [NAME] bodies to receive further fees from [NAME]'s conduct of gambling activities previously undertaken by the [NAME]. 153 On 28 June 1994, [NAME] was granted the [NAME] [NAME] and the gaming [NAME] pursuant to s 12 of the [NAME]. Thereafter, [NAME] acquired the business formerly conducted by the [NAME]. [NAME] appointed [NAME] as the [NAME] of the [NAME] [NAME] pursuant to s 22(1) of the [NAME]. 154 From 1994, pursuant to the [NAME], off-course betting was prohibited in [NAME] unless conducted by, or through, [NAME]. At the same time, [NAME] was obliged to make substantial payments to the [NAME] pursuant to the JVA and the other agreements that it had made with the [NAME]. [NAME] was, moreover, subject to various controls, limitations and restrictions: see, e.g., [NAME], ss 6(d), 12(2)(b), 64, 67, 70, 71, 72. 155 A decade later, the [NAME] was repealed, with effect from 1 July 2004, by s 12.1.1(b) of the GRA. The repeal of the [NAME] did not, however, mean the abandonment of the regime that had previously operated. The main purpose of the GRA (as stated in s 1.1(1)) was merely "to re-enact and consolidate the law relating to various forms of gambling and to establish a [NAME] Commission for Gambling Regulation". 156 As first enacted, the main objectives of the GRA, as stated in s 1.1(2), were: (a) to foster responsible gambling in order to – (i) minimise harm caused by problem gambling; and (ii) accommodate those who gamble without harming themselves or others; … (b) to ensure that gaming on gaming machines is conducted honestly; (c) to ensure that the management of gaming machines and gaming equipment is free from criminal influence and exploitation; (d) to ensure that other forms of gambling permitted under this or any other Act are conducted honestly and that their management is free from criminal influence and exploitation; (e) to ensure that – (i) community and charitable gaming benefits the community or charitable organisation concerned; (ii) practices that could undermine public confidence in community and charitable gaming are eliminated; (iii) [COMPANY] do not act unfairly in providing commercial [COMPANY] to [NAME]; (f) to promote tourism, employment and economic development generally in the State. (Emphasis added) Some of these objectives were [NAME] here, particularly to [NAME]' case on these appeals. 157 The [NAME] structure of the GRA was straightforward enough. Chapter 2 – entitled "General Prohibition on Gambling" – was intended "to impose a general prohibition on gambling and create certain offences": see s 2.1.1. Elsewhere, the GRA (relevantly, in Ch 4) and the [NAME] ([NAME]) made certain specified exceptions to the general prohibition in Ch 2 and regulated the excepted gambling activities. 158 When enacted, Ch 4, entitled "[NAME]", stated in s 4.1.1 that its purpose was: (a) to make provision for the carrying on of licensed [NAME] and betting, by – (i) the issuing of a [NAME] [NAME]; (ii) the approval of betting competitions; (iii) the issuing of permits to conduct on-course [NAME]; (b) to provide for the issue of a gaming [NAME] in conjunction with the issue of a [NAME] [NAME], allowing the [NAME] to conduct gaming in accordance with Chapter 3. 159 In particular, Ch 4: (a) gave the [NAME] in Council, on recommendation from the [NAME] and subject to Ministerial satisfaction, power to grant a [NAME] [NAME] and a gaming [NAME] (s 4.3.8(1) and (2)); (b) provided that the [NAME] in Council must not grant a [NAME] [NAME] unless the Minister, after consultation with the [NAME], was satisfied that certain arrangements had been made between the [NAME] and [NAME] (s 4.3.8(2)); (c) provided that the conduct of [NAME] and approved betting competitions was lawful when conducted in accordance with the [NAME] [NAME] and was not a public or private nuisance (s 4.2.1(1)); (d) provided that any place in which lawful [NAME] (see s 4.2.1(1)) or an approved betting competition was conducted was not a [NAME] (s 4.2.1.(2)); (e) provided for the appointment of a wholly-owned subsidiary of the [NAME] as [NAME] of the [NAME] [NAME], subject to the approval of the [NAME] (s 4.3.15); (f) provided that the use of a [NAME] as provided by Ch 4 was lawful, did not constitute a [NAME] or betting offence, was not a ground for any place to be taken to be a [NAME], and is not a public nuisance (s 4.2.2); (g) provided that the [NAME] and the [NAME] must only use equipment in connection with a [NAME] or approved betting competition approved by the [NAME] (s 4.2.3); (h) provided that the [NAME] and the [NAME] must not conduct a [NAME] or an approved betting competition without betting rules, being rules that met prescribed requirements and which were not disallowed by the [NAME] (ss 1.3(1), 4.2.4 to 4.2.6); (i) provided that the [NAME] [NAME] authorised the [NAME] and the [NAME] to conduct [NAME] and approved betting competitions, subject to conditions, the GRA and regulations, and the [NAME] (s 4.3.1); (j) authorised the operation at the same time of no more than one [NAME] [NAME] and one gaming [NAME] (s 4.3.3); and (k) provided that the [NAME] [NAME] and the gaming [NAME] were each for a term of 18 years, or a longer term as determined by the [NAME] in Council (s 4.3.9). 160 In the GRA, "[NAME]" is defined as "pari-mutuel betting on a horse race, harness race or greyhound race" (s 1.3(1)). For a discussion of pari-mutuel (or [NAME]) betting, see [COMPANY] v [NAME] (2010) 189 FCR 356 ("[NAME] v [NAME]") at 361 [15]. Within Ch 4, "[NAME]" meant "the [NAME] and the gaming [NAME]" and "[NAME]" meant "the [NAME] or an [NAME] appointed under section 4.3.15(1)(b)": see s 4.1.2. "Approved betting competitions" were those approved by the Minister under s 4.5.3 in relation to horse, harness and greyhound [NAME], or the [NAME] under s 4.5.6 of the GRA in relation to other events. 161 When the legislative history is considered, it becomes apparent that the scheme enacted under the GRA essentially carried on the scheme that had previously existed under the [NAME]; and that the scheme under the [NAME] was built on, and developed from, the scheme introduced by the [NAME] ([NAME]) Act 1960 ([NAME]). Furthermore, the GRA deemed [NAME] to be the [NAME] under Pt 3 of Ch 4 of the GRA "for the balance of the term of the [NAME] subject to any conditions to which the [NAME] was subject immediately before that day": see GRA, s 12.2.1, Sch 7, cl 4.2(1). [NAME] was deemed to be appointed as [NAME] of the [NAME] [NAME] under s 4.3.15(1) of the GRA: see GRA, s 4.3.15(1), Sch 7, cl 4.2(3). In this way, the [NAME] [NAME] granted to [NAME] under the GBA on 28 June 1994 was continued under the GRA. 162 Furthermore, the provisions of Ch 2 with which these appeals are concerned derived from legislation that preceded the GRA. Section 2.5.2 originated with s 4 of the Police Offences Statute Amendment Act 1872 ([NAME]). Section 2.6.1 was first enacted in 1986 as s 66B of the Lotteries Gaming and Betting Act 1966 ([NAME]). Section 115 of the LCRA derived from s 97 of the Licensing Act 1906 ([NAME]), first enacted on 28 December 1906. 163 The offence provisions in Ch 2 of the GRA and s 115(1) of the LCRA apply to all [NAME] who might otherwise want to provide an off-course [NAME] betting service in [NAME], with the exception of the authorised activities of the [NAME] [NAME] and the [NAME]. The law of the State thus contemplates that there is only one company with the [NAME] to engage in off-course [NAME]. The legislative scheme operates so that the sole [NAME] [NAME] held by [NAME] authorises only it and [NAME] to conduct off-course [NAME] betting by means of [NAME] [NAME] and approved betting competitions – the latter currently including fixed odds betting on races and other events: see [NAME] at 462 [170]-[171]. Consequently, only [NAME] may currently establish an off-course "[NAME] presence" in [NAME] for betting: see [NAME] at 431 [22]. As already noted, the [NAME] is for a defined and finite period. In accordance with its [NAME] [NAME], within [NAME], only [NAME] and [NAME] conduct a [NAME] (as defined in s 1.3(1)). This is sometimes called "[NAME] exclusivity". Also in accordance with its [NAME] [NAME], as already noted, [NAME] provides various [NAME] betting facilities, including [NAME].

The business of [NAME] 164 [NAME] paid approximately $597.2 million for the [NAME] [NAME] and concurrent gaming [NAME] granted to it in 1994. At the time of the [NAME], [NAME] was the largest [NAME] in [NAME], with customers throughout Australia and overseas. 165 [NAME] remains subject to particular scrutiny under the GRA and, in some instances, regulation by the [NAME]. For instance, the [NAME] must approve [NAME]'s instruments of betting and betting rules; and [NAME] must submit to audits and related processes: see GRA, ss 4.2.3, 4.2.6, 4.3.10A and 4.8.2-4.8.6. Under the JVA, [NAME], represented by [NAME], scrutinises and has a voice in [NAME]'s activities. Through participation in the Joint Venture Management Committee and the Joint Venture Operations Committee, [NAME] has access to significant information about [NAME]'s [NAME] [NAME] business and can affect the strategic and operational aspects of that business. 166 [NAME] place bets with [NAME] in various ways – in person at a [NAME] [NAME] outlet, whether off-course or on-course; over the telephone; via an internet-enabled mobile phone or an iPhone application; via interactive pay television; via the internet; and via [NAME]. The [NAME] judge found that [NAME]'s [NAME] [NAME] accounted for most of [NAME]'s [NAME] business: see [NAME] at 455 [139]. At the time of [NAME], [NAME] operated about 627 [NAME] outlets in [NAME], 528 of which were licensed venues. Indeed, the [NAME] judge found that [NAME] had an established network of off-course [NAME] outlets, some staffed and some self-service: [NAME] at 455 [139].

[NAME] 167 In cross-examination, [NAME]'s [NAME] [NAME] Manager, [NAME] [NAME], described [NAME] as "the future in terms of expanding our footprint in the venues". The [NAME] judge found that [NAME] were widely distributed through licensed venues in [NAME] ([NAME] at 442 [82]); and, at the time of the [NAME], betting via [NAME] accounted for nearly 50% of all bets sold through [NAME] outlets. [NAME] allowed customers to access software connected to [NAME]'s [NAME] network and, by this means, to view and select from [NAME]'s betting products. [NAME] accepted payment for selected products in the form of cash, vouchers, betting tickets and pre-paid in-funds betting accounts. ([NAME] is unable to extend credit: see GRA, s 4.7.6.) 168 [NAME] relied on the fact that, whilst [NAME] was permitted to install [NAME] in this way, by reason of the impugned provisions, [NAME] was unable to install betboxes at licensed premises anywhere in [NAME]. This was said to support [NAME]'s claim that the impugned provisions were inconsistent with s 49 of the Self-Government Act.

[NAME] 169 [NAME]'s [NAME] [NAME] permitted it to conduct: (1) [NAME] off-course and on-course in relation to horse, harness and greyhound [NAME]; and (2) "approved betting competitions", including fixed odds betting on horse, harness and greyhound races, and on various other sporting and non-sporting events. [NAME]'s contribution to [NAME], discussed further below, was largely derived from [NAME] [NAME]. The evidence at the [NAME] showed that, whilst [NAME]'s engagement in fixed odds [NAME] had increased, especially since 2008, fixed odds [NAME] remained only about 20 per cent of its race [NAME] business. 170 As already indicated, only [NAME] was able to conduct a [NAME]. There was cogent evidence before the [NAME] judge that [NAME] [NAME] was less prone to corruption than other methods of [NAME]. As Justice Martin had observed in 1959, this was because, unlike a fixed odds [NAME], the [NAME]'s return is a fixed proportion of turnover, regardless of the outcome of the event the subject of the wager. [NAME]'s General Manager, Finance, [NAME], [NAME] [NAME], further explained that "[t]he amount that [NAME]'s [NAME] business may deduct as its take-out from the [NAME] [was] [COMPANY] by a statutory maximum (which flows from the operation of sections 4.2.5(2B) and 4.4.8 of the GRA)". 171 There were also other advantages of [NAME]. [NAME] provided a ready basis for all [NAME] to place bets, irrespective of their betting knowledge. [NAME] could inform their assessments by using the [NAME] [NAME] as a reflection of how others viewed the prospects of each entrant in the race. More experienced [NAME] could be confident that large bets would be accepted. [NAME] was amenable to auditing. The success of a [NAME] depended, however, on characteristics of structure and scale. A single, large [NAME] increased the prospect of a good return because there was a substantial [NAME] of money to distribute amongst the [NAME] [NAME]. Since the [NAME] was more [NAME] than other forms of [NAME], its indicative odds were more accurate. If, however, the [NAME]'s [NAME] became too small, it became more unstable and more open to manipulation. This last-mentioned characteristic was important in the consideration of alternative models for funding [NAME].

[NAME] and the current funding of the [NAME] 172 [NAME] [NAME] unchallenged evidence was that: A [NAME] [NAME] is created and sustained by providing good quality [NAME] events (i.e. a good 'spectacle') through: (a) securing the best race entrants (i.e. the best horses, dogs, jockeys and drivers, as appropriate); (b) providing a large 'field' of entrants for each race; (c) ensuring that the race track and facilities are kept in optimum condition; and (d) providing high quality on-course entertainment. Where a [NAME] is able to secure a number of consistently good quality [NAME] events, those [NAME] events typically develop the prestige of that [NAME], which further encourages the participation and involvement of high calibre race entrants and [NAME] [NAME]. 173 The evidence at [NAME] was to the effect that the better [NAME] was funded, the better the spectacle it could afford to stage; and, in any case, to present a high-quality spectacle and a prestigious event, the [NAME] had to be well funded. A number of witnesses gave evidence that the prestige and success of the [NAME] depended on it providing a high quality spectacle; and that, without this spectacle, the [NAME] would not draw top race performers or continue to encourage new [NAME], trainers and other [NAME] to enter the [NAME]. 174 Substantial funds were needed, especially for high prize money. The Chief Executive of the [NAME] Board (ARB), [NAME] [NAME], and the [NAME] and [NAME] in the Department of Justice, [NAME], both gave evidence that the revenue from [NAME] determined the prize money that race clubs offered at race meetings, as well as the number of racecourses and race meetings that the clubs could afford to support. The level of prize money affected not only the attraction of races to race entrants but also the prestige of the races. Further, prize money affected other critical aspects of the [NAME], including the number of horses bred, owned and raced, the number of people employed as trainers, jockeys and [NAME], the size of the race fields, and the scope of associated [COMPANY] such as horse transport and veterinary [COMPANY]. 175 Besides funding prize money, the [NAME] also relied on [NAME] revenue to cover the costs of its regulatory and stewarding functions, track management and capital works, training and marketing. 176 [NAME]'s relationship with the [NAME] was unique. [NAME] [NAME] evidence at [NAME] was that there was "a close symbiosis between [NAME] and race [NAME]". Most of the [NAME]'s revenue derived from distributions by [NAME] to the [NAME]'s controlling bodies under the JVA: see [NAME] at 453 [135]. [NAME] revenue derived from sources other than [NAME] was significantly less than from [NAME]: see [NAME] at 453 [135]. The level of [NAME] of funds from [NAME] to the [NAME] largely correlated to the level of [NAME] turnover. Thus, the total contribution from [NAME]'s [NAME] business in the financial year ending 30 June 2010 was approximately $338 million (equal to about 45.7% of [NAME]'s [NAME] business revenue). 177 The current funding model, which is dependent on the legislative regime of which the impugned provisions form part, has sustained the success of the [NAME]. The [NAME] judge found that the current [NAME] funding model was and remained highly [NAME]. [NAME] acknowledged that [NAME]'s contributions were "an essential part" of keeping the [NAME] "vibrant and [NAME]" and that the [NAME]'s position "could not be maintained without substantial funding of the kind it presently receives", which necessarily included contributions from the gambling [NAME]: see [NAME] 454 [136], 457 [148]-[149]. The evidence of numerous witnesses at [NAME] clearly justified these findings. Indeed, [NAME]'s former Chief Executive Officer, [NAME] [NAME], accepted in cross-examination that the [NAME] could not sustain its current position without funding of the kind it presently received; and that payments by [NAME] to [NAME] were essential for its continued success. 178 [NAME]'s contribution to [NAME] was largely derived from [NAME] [NAME], which over time has proved, as Justice Martin predicted, a reliable means of generating funds for the [NAME]. The evidence established, as the [NAME] judge accepted, that [NAME] [NAME] provided greater revenue certainty for [NAME] than revenue based on other forms of [NAME]: see [NAME] 455 [139]. [NAME] gave evidence that a [NAME] [NAME] was important for the continued success of the [NAME]. For example, [NAME] [NAME], from the ARB, concluded that "having a [NAME] and [NAME] in each key [NAME] jurisdiction is essential in order for [NAME] to continue to maintain its current level of funding and to continue to perform as it does". This was borne out by the fact that funding through [NAME] [NAME] was also the model "adopted in other Australian jurisdictions and internationally": see [NAME] at 454 [136]. Thus, [NAME] [NAME] was the means used for funding the most significant [NAME] industries in the Asian region (including Hong Kong, Japan, Singapore, South Korea and New Zealand). 179 Further, a number of [NAME] gave evidence that [NAME]'s [NAME] exclusivity was significant in maintaining its funding level for the [NAME]. [NAME]'s [NAME] exclusivity prevented [NAME] losing business to [NAME] competitors, the [NAME] [NAME] remained of sufficient size to operate at its optimal level and [NAME]'s financial position continued to ensure that its contributions to the [NAME] were sufficient to sustain a [NAME] [NAME]. As the [NAME] judge noted, the financial viability of the [NAME] and its integrity depend on the [NAME] retaining a critical [NAME] size for [NAME] [NAME]. The evidence established that the sole [NAME] [NAME] regime for the provision of off-course [NAME] betting [COMPANY] in [NAME] was conducive to the preservation of this critical [NAME] size. 180 Further, given that an ability to manipulate the odds offered by a [NAME] increased if the size of the [NAME] [NAME] fell below the critical size, the maintenance of the [NAME] size was important for the integrity of [NAME] [NAME]. [NAME] [NAME] and [NAME] [NAME] both gave unchallenged evidence that: (1) a small [NAME] [NAME] was more susceptible to destabilisation through the placement of large wagers than a larger [NAME]; and (2) a smaller [NAME] [NAME] was less attractive to high value [NAME] who looked for a larger [NAME] where the weight of investment ensured what [NAME] [NAME] called "stability of dividends". Thus, [NAME] [NAME] said: [A] smaller [NAME] [NAME] is … more susceptible to manipulation by [NAME] and [NAME] alike. For example, [NAME] seeking to reduce his or her liability to [NAME] who have backed a particular horse at [NAME] odds can do so by placing a substantial bet on the same horse on the [NAME] as it is about to close. Where the [NAME] [NAME] is small, this will artificially reduce the dividend that the [NAME] is required to pay out if the [NAME] wins. Conversely, a [NAME], who has placed a substantial wager on a horse, with [NAME] at [NAME] odds, can enhance the dividend on that horse by making a last minute place bet on other horses on the [NAME]. Where the [NAME] [NAME] is small, this will artificially depress the [NAME] odds on the other horses, while increasing the odds for the horse on which the [NAME] placed the more substantial fixed-odds wager. The possibility of [NAME] manipulation cannot be discounted, as [NAME] sought to do. [NAME] [NAME] evidence was that there had been an instance of [NAME] manipulation within the three or four years preceding the [NAME]. 181 Unsurprisingly, the precise effect of [NAME]'s loss of [NAME] exclusivity on the [NAME] was difficult to quantify. Plainly enough, as the evidence showed, the effect of the loss of [NAME] exclusivity would depend on a number of factors, including the number of corporate [NAME] and others entering the [NAME] [NAME] [NAME] market and their respective business operations. There was, however, evidence that, without [NAME] exclusivity, [NAME]'s financial position would be undermined and its contributions to the [NAME] would decrease. If [NAME]'s contributions decreased, then so too would the available prize money. A fall in the level of prize money would reduce the incentive for [NAME], [NAME] and others to participate in the [NAME]. 182 There was also evidence that, without [NAME] exclusivity, the [NAME] would be compromised and [NAME] [NAME] would cease to be a significant source of funding for [NAME]. In this regard, there were two [NAME] factors: first, the need to maintain the size of the [NAME]'s [NAME], as explained above; and, second, the prevalence of "tote odds" – a product in which corporate [NAME] such as [NAME] agreed to match or better the dividends paid by a [NAME] in a particular [NAME]. A number of witnesses, including [NAME] [NAME], [NAME] [NAME] and [NAME] [NAME], gave evidence that "tote odds" betting would be likely to damage [NAME] if [NAME] did not have [NAME] exclusivity. This was largely because corporate [NAME] had lower operational costs than [NAME], whose costs included maintaining [NAME]. In [NAME] [NAME] words: [NAME] offer a competing [NAME]-matching product and can do so because of their lower costs model which in turn is driven in part by lower contributions to the [[NAME]]. 183 [NAME] [NAME] explained: [NAME] betting attracts customers because of its convenience and therefore the exclusive ability to provide [NAME] betting gives the Totes a point of difference that they can use. That point of difference is particularly important in the current environment, where corporate [NAME] mimic the Totes' [NAME] service through the provision of a tote odds service, thus eroding any point of difference that the Totes may otherwise have enjoyed based on their [NAME] product offering. In these circumstances, a [NAME] in where the Tote retains sole authorisation to provide pari-mutuel [NAME] [COMPANY] but does not have [NAME] exclusivity would have the potential to significantly reduce the funding of [NAME]. 184 [NAME] [NAME] added that: These products effectively replicate the attraction of a [NAME] service by guaranteeing to match (or better) the [NAME]'s dividends. [NAME] regularly offer tote odds products and can afford to do so because they do not have the same overheads associated with operating complex [NAME] pools and because they can manage their risk by betting back into the [NAME] pools if necessary. In view of [NAME]'s funding and other obligations including to the [NAME], and its [NAME] structure, it cannot offer equivalent dividends. In these circumstances, if corporate [NAME] offered tote odds products in a [NAME] setting, this would effectively eliminate [NAME]'s current point of difference and concurrently confer a significant competitive advantage on corporate [NAME]. 185 The evidence of [NAME] [NAME], [NAME] [NAME] and [NAME] [NAME] showed that the maintenance of a [NAME] [NAME] depended on the maintenance of [NAME] exclusivity, not merely [NAME] exclusivity. Given the evidence concerning the benefits of [NAME] [NAME], there was clear evidence that injury to the [NAME] might well deprive the [NAME] of some of the inherent and important benefits of [NAME] [NAME] and also reduce the reliability of appropriate funding for a [NAME] [NAME].

Alternative models for funding the [NAME] 186 There was evidence that a different funding model in the United Kingdom has not proved as [NAME] so far as the UK [NAME] is concerned. [NAME] in the United Kingdom is funded by a levy scheme, pursuant to which the [NAME] and [NAME] negotiate annually on the level of a levy for the following year or, absent agreement, a levy is determined by the Secretary for [NAME]. Most betting in the United Kingdom takes places with off-course corporate [NAME], operating "high [NAME]" betting shops. Under this scheme, [NAME] funding to [NAME] has varied greatly over the past decade and is apparently in decline, with adverse effect on the [NAME], including available prize money. 187 The two economists – whose evidence was discussed by the [NAME] judge in [NAME] at 450-451 [118]-[123] – were both unable to proffer a funding alternative for [NAME] that did not contain significant difficulties and inefficiencies. In his report, [NAME] [NAME], an economist whose opinion was relied on by the State and [NAME], identified and considered three other mechanisms that might be employed instead of the current model, including a uniform fee. [NAME] [NAME] concluded that each of these other mechanisms were deficient when compared with the current model. In summary, his opinion was that: [R]etail exclusivity has the advantage of internalising and aligning the incentives of [NAME] and its chosen partner. By making a substantial commitment to a single exclusive [NAME] partner, the State can allow [NAME] to maximise its bargaining power, providing incentives for the chosen [NAME] partner to make financial contributions to [NAME] that it would not have an incentive to concede in the absence of exclusivity. … The main potential disadvantage of [NAME] exclusivity arises from the risk that this model could allow a single [NAME] to operate free from competitive pressures, e.g. at low levels of efficiency and/or at unduly high rates of profit. … As I have explained above, however, there is a clear incentive for the State and [NAME] to include contractual conditions on [NAME] to guard against those dangers, and I note the existence of a number of contractual provisions that have been placed around [NAME]'s [NAME] that are designed to do so … . 188 There was evidence that, if the current funding arrangements were replaced by a uniform fee paid by all [NAME], at present turnover levels, that fee needed to be set at a level that most [NAME] would be unable to pay because the fee would exceed [NAME]'s typical profit margin. There was also evidence that a uniform revenue fee would be no less uncommercial. That is, if a uniform revenue fee were introduced, the evidence indicated that [NAME] would need to pay around 41% of their revenue to achieve the level of funding attracted on the existing model in the 2009/2010 financial year. Further, this funding option would be less [NAME] than the current one. Thus, the economists' evidence indicated that there was no alternative equally efficient and viable funding model to that which already operated.

The business of [NAME] 189 It is convenient at this point to turn to the business of [NAME], the consideration of which is important for resolving the appeals. [NAME] is a corporate [NAME] with an annual turnover of about $2 billion. As already stated, [NAME] is not [NAME] as [NAME] in [NAME] under the GRA, but holds a [NAME] under the [NAME]) to conduct the business of sports bookmaking from its licensed premises in Darwin: see [NAME]), s 70. 190 The [NAME] judge found (at 441 [78]) that: [NAME] wishing to place a bet with [NAME] must first register and acknowledge [NAME]'s terms and conditions. A bet placed with [NAME], the [NAME]'s computer server and [NAME]'s bookmaking business, are all regulated by [NAME] law. [NAME] accepts bets by telephone and over the internet from [NAME] members situated throughout Australia, including [NAME]. The contingencies on which [NAME] players bet include races conducted in each [NAME] and sporting events conducted in each state and internationally. 191 [NAME] operates a number of computer servers from its licensed premises. A [NAME] [NAME] customer may place bets by use of a computer connected via the internet to one of these servers. The [NAME] judge found that "[c]ustomers may be located outside the [NAME] and [NAME] seeks to attract such customers located in [NAME] of the Commonwealth including [NAME]": see [NAME] at 442 [83]. As we have seen, [NAME] also sought to accept wagers over the internet by means of a [NAME] installed in licensed premises in [NAME]. 192 The [NAME] judge made a number of important findings with respect to the conduct of [NAME]'s business that were not challenged on the appeals: see [NAME] at 442-444 [84]-[87]. These findings were that: (a) [NAME] was [NAME] as a company on 29 June 1999 under the [NAME] 1989 (Cth), as applied to the [NAME] by the [NAME]) Act 1990 (NT). Its [NAME] office was that specified in the registration application: see ss 117 and 121. When the [NAME] Act 2001 (Cth) (the [NAME] Act) commenced, [NAME]'s registration was taken to have effect under the corresponding provisions of the [NAME] Act. [NAME]'s [NAME] office and principal place of business remained the same: s 1378(3) of the [NAME] Act. Moreover, for the purposes of s 119A of the [NAME] Act, [NAME] was taken to be [NAME] in the [NAME]: s 1378(4) of the [NAME] Act. (b) [NAME] had a [NAME] licensed business which operated from licensed premises at the [NAME] in Darwin under the [NAME]). (c) [NAME]'s [NAME] under the [NAME]): (1) permit[ted] [NAME] to offer a much wider range of bets to [NAME] than that permitted under [NAME] law; (2) permit[ted] [NAME] to provide credit to [NAME] (contrary to anywhere else in Australia); (3) permit[ted] [NAME] a more flexible approach to marketing (than other places in Australia); (4) until recent changes to the [NAME] legislation, provided [NAME] with better access to capital resources because the [[NAME])] did not insist on directors and shareholders of the [NAME] themselves being [NAME]; (5) required, as a condition of the [NAME], that [NAME] take[] bets from the [NAME] in Darwin. (d) a significant part of [NAME]'s computer [NAME] was located in [NAME]'s customers (both national and international) interacted with the [NAME] business through the [NAME]. (e) while [NAME] had a [NAME] office in Darwin, it had much larger offices in [APPELLANT]. (f) a substantial part of [NAME]'s business was conducted in [APPELLANT] "including its IT department, marketing, human relations, finance and administration, its [NAME], the risk management department for real time client bet monitoring and the fraud department including anti-money laundering checking" (443 [84]). (g) the management of [NAME]'s business was conducted in [APPELLANT] and there was a far greater concentration of senior and other staff in [APPELLANT]. (h) [NAME]'s senior management spent most of their time in [APPELLANT] and were resident in [APPELLANT]. (i) although [NAME]'s [NAME] explained the physical location of [NAME]'s servers at the [NAME], the [NAME] had no significance for the purposes of the impugned provisions because it did not confer any right, and did not purport to confer any right, on [NAME] to engage in bookmaking in [NAME]. (j) by installing the "[NAME]" with logos and advertising, [NAME] had a physical presence in [NAME] and, in substance, the transactions occurred within [NAME]. 193 [NAME] [NAME], a [NAME] inspector employed by the Licensing, Regulation and Alcohol Strategy Division in the [NAME]'s Department of Justice, gave substantially unchallenged evidence about the regulation of licensed [NAME] in the [NAME]. [NAME] [NAME] evidence was that, in the [NAME], a licensed sports [NAME] such as [NAME] was required "to record and maintain all betting and financial information" and to supply the information to the [NAME] Commission (NTRC) for audit and compliance purposes. A sports [NAME] was also required to comply with accounting procedures; to maintain proper betting records; to ensure [NAME], directors and [NAME] undergo police checks; to report unusual betting circumstance to AUSTRAC; and to comply with the [NAME]'s Mandatory Code for Responsible Gaming. [NAME] [NAME] made it clear, however, that the [NAME] pursued a policy of "minimum regulatory intervention". This was consistent with s 17(2) of the [NAME]). 194 [NAME] was free to advertise in [NAME] and to accept bets from its [NAME] members in [NAME] (other than through a [NAME]). [NAME] was liable to pay a fee to [NAME] race control bodies for the use of [NAME] race field information. [NAME] submitted on the appeals that this contribution was similar to that which applied to fixed odds wagers accepted by [NAME] and [NAME], the evidence to which [NAME] referred did not bear this out and indicated, instead, that [NAME] made a significantly higher rate of contribution derived from fixed odds betting than [NAME].

[NAME] 195 [NAME]'s National Business Manager – [NAME], [NAME] [NAME], gave evidence that [NAME] wanted to install betboxes in licensed premises throughout [NAME]. The [NAME] judge found that [NAME] operated from [COMPANY] was "intended to attract customers to [NAME] and to attract patrons to [COMPANY]": see [NAME] at 439 [63]. [NAME] continued (at 439 [63]): The idea was that by putting the "[NAME]" in the sports bar of the [APPELLANT], [NAME] would have a drink, watch television, eat a meal and bet on the "[NAME]". … In fact, the [NAME] for the "[NAME]" between [[NAME] and [APPELLANT]] included an obligation to locate the "[NAME]" in a prominent and visible position adjacent to the main bar. [NAME] paraphernalia was disseminated throughout the bar to attract customers. [NAME] found that [NAME], including the computer terminal located within it, constituted "the physical presence of [NAME] within the venue": see [NAME] at 439 [64]. 196 As noted at the outset of these reasons, [NAME] is a device by which a customer selects and places a bet with [NAME] and [NAME] notifies the customer of its acceptance of the bet: [NAME] at 434 [40]. The [NAME] judge described the operation of [NAME] at [COMPANY] (at 445 [92]) as follows: Here, a [NAME] in [NAME] approached a "[NAME]" situated in [NAME] which was installed in [NAME] and owned by [NAME]. On approaching the "[NAME]", the [NAME] accessed information on a website maintained by [NAME] and selected a race on which to place a bet. The [NAME] then selected the size of the bet and sent that "request". The request was received by [NAME] on its server located in Darwin. That server then communicated [NAME]'s acceptance of that bet with notification of acceptance of the bet being capable of being received on the "[NAME]" in [NAME]. 197 In contrast to [NAME]'s [NAME], [NAME] customers set up betting accounts via [NAME] and [NAME] could extend credit to them. The [NAME] servers in Darwin used software developed by [NAME] to process the bets communicated via the servers to it. Ordinarily, [NAME] accepted a bet via this automated process. Thus, [NAME] found that "[NAME]'s customers … interact with the [NAME] business through the [NAME]": see [NAME] at 444 [87]. A decision requiring human decision-making was, however, generally made in [APPELLANT] (for example, as to extending or terminating credit to a [NAME] member or as to accepting a substantial bet outside a member's normal profile). 198 [NAME] contended that the [NAME] granted to [NAME] under the [NAME]) did not authorise [NAME] to operate off-course betboxes. This was because [NAME]'s [NAME] only authorised [NAME] to conduct the business of a sports [NAME] at identified premises at the [NAME] in Darwin. This latter proposition may be accepted. There is, however, no contravention of the Unlawful Betting Act (NT) whilst [NAME] conducts its business in accordance with its [NAME]: see ss 31 and 33. If [NAME] were to open premises not on the Racecourse to the public "to attend in person for the purposes of placing a bet", then [NAME] would apparently breach special condition 24 of its [NAME]. On these appeals, however, there is no occasion to determine whether special condition 24, or some other [NAME] condition or statutory provision, would be engaged in the event that [NAME] installed a [NAME] at a place in the [NAME] other than the [NAME]. This is not what [NAME] has done. It is immaterial that, as [NAME] [NAME] stated in cross-examination, [NAME] had not applied for approval to use a [NAME] in the [NAME]. It may well be that, as [NAME] submitted, [NAME] would require specific authority from the NTRC to operate a [NAME] in the [NAME], but this is not what [NAME] has sought to do. Whether approval, if sought, would be given is speculative. On these appeals, [NAME] condition 8 is [NAME] in so far as it permitted [NAME] to accept bets, over the internet or by any electronic means approved by the NTRC, from anywhere at its premises at the [NAME]. [NAME] [NAME] deposed that [NAME] had given the NTRC a prototype [NAME] for review and had informed the NTRC of its intention to operate a [NAME] from outside the [NAME]; and that the NTRC had confirmed that [NAME] complied with [NAME]'s [NAME]. Having regard to [NAME]'s [NAME] and [NAME] [NAME] evidence, [NAME]'s proposed use of betboxes in [NAME] was not shown to be inconsistent with [NAME]'s [NAME] conditions or otherwise unlawful under the law of the [NAME]. [NAME]'s argument with respect to these matters should be put to one side.

[NAME] 199 In relation to [NAME], the [NAME] judge found (at 442 [82]) that: [NAME] competes with [NAME] in a national [NAME] market. … [W]agering [COMPANY] on [NAME] and sporting events are supplied throughout Australia by means of telephone and the internet to users of those [COMPANY]. That competition has been increasing for at least 10 years and is now "fierce". … [NAME] accepts bets over the internet and through "[NAME]" … [NAME] also competes against [NAME] in [NAME] who are able to stand at racecourses and accept bets by [NAME] present on the racecourse, over the telephone and over the internet: ss 4 and 4A of the [NAME]. [NAME] established "[NAME]", a [NAME] in response to [NAME] and other corporate [NAME] offering [NAME] products. This competition has resulted in lower priced [NAME] products for [NAME]. 200 In recent years, [NAME] corporate [NAME], mostly operating internet and telephone businesses, have become more prominent in [NAME]. It has become commonplace for persons in [NAME] to place bets, via internet or telephone, with [NAME] [NAME] providers. In this respect, the market has changed since 1994 when [NAME] was incorporated and granted the sole [NAME] [NAME]. [NAME] [NAME] stated in cross-examination that competition amongst [NAME] service providers was not significant in 1994, but that competition only became "more fierce" "towards the latter part of the 1990s", although, as at 2001, corporate [NAME] had "only a niche segment of the [NAME] market". By July 2010, however, [NAME] faced significant competition from a range of [NAME] throughout Australia. 201 The popularity of corporate [NAME] had seemingly some adverse effect on [NAME], particularly with respect to its [NAME] [NAME], as evidenced by a relative decline in funding to [NAME] in recent years. This decline had been stalled, however, by changes in [NAME]'s business, including [NAME]'s expansion of its fixed odds business. Indeed, as [NAME] noted, there was evidence that there had been a growth in the [NAME] market over the past few years; a steady increase in [NAME]'s [NAME] turnover in the five years from 2006; and a steady increase in prize money paid in the same period. Over the past decade, moreover, [NAME]'s revenue had grown more or less steadily, as had the revenue received by [NAME] [NAME]. 202 [NAME] affirmed and [NAME] denied that [NAME]'s fixed odds business had altered, or would inevitably alter, the operation of the current [NAME] funding model. As noted earlier, however, the proportion of [NAME]'s revenue derived from its fixed odds business is comparatively small compared with its [NAME] revenue. Further, if this or some other aspect of its business were seen to threaten the existing funding model, including [NAME] [NAME], [NAME]'s approval in respect of that aspect of its business could be revoked under s 4.5.5 of the GRA. 203 [NAME] sought to develop arguments based on: (1) the amount of [NAME]'s [NAME] fee allegedly attributable to gaming rather than [NAME]; and (2) the refund provisions of the GBA. Neither matter was raised before the [NAME] judge. If it had been, further evidence might well have been led in response. We would therefore put these arguments to one side. In any event, there was some evidence that any contribution from [NAME]'s gaming business to [NAME] was only a relatively minor component of [NAME]'s overall contribution to the [NAME].

OVERVIEW OF [NAME] 204 Before outlining the principles for construing s 92 and hence s 49 of the Self-Government Act, it is convenient to note a pertinent difference between the operation of s 92 and s 49. 205 As the joint judgment in [NAME] observed, s 49 of the Self-Government Act is expressed as a command: see [NAME] at 409 [10]. Citing Lamshed v Lake (1958) 99 CLR 132 at 147, the [NAME] there explained that "a federal law in the terms of s 49 is a 'positive rule' relating to the government of the [NAME] and thus supported by s 122 of the Constitution". Previously, in [NAME] v [NAME], [NAME], [NAME] and [NAME] [NAME] said (at 176 [37]): Lamshed v Lake … establishes that provisions such as s 49 of the Self-Government Act are laws of the Commonwealth which attract the operation of s 109 of the Constitution. As a species of what is often identified as "operational inconsistency", this supremacy of Commonwealth law operates to exclude, in relation to the matters to which it applies, the operation of the laws of a State … . [NAME[NAME] agreed: see [NAME] v [NAME] at 232-233 [220]-[221]. 206 The relevance of this distinction is that, whilst s 92 renders the infringing legislation or executive measure invalid, s 49 of the Self-Government Act does not limit State legislative power. If the operation of a State law is inconsistent with s 49, then s 109 of the Constitution is attracted, with the result that the State law is inoperative to the extent of the inconsistency. An exercise of discretionary power under State legislation that is inconsistent with s 49 is not, of course, affected by s 109, although it would involve an error of law: see [NAME] at 409 [12]; [NAME] v [NAME] at 176 [37]; [NAME] v [COMPANY] (1986) 161 CLR 556, at 596-597, 614-615; and [NAME] v [COMPANY] (2010) 189 FCR 448 ("[NAME] v [NAME]") at 490-491 [141]. 207 As noted earlier, s 49 of the Self-Government Act is to be given an ambulatory interpretation that follows the construction of s 92.

Accordingly, the principles [NAME] to the construction of s 92 are also [NAME] to s 49 of the Self-Government Act. These principles are outlined below.

[NAME] 208 In the decade immediately before [NAME] (1988) 165 CLR 360 ("[NAME]"), the High Court was unable to agree on an approach to the construction of s 92: see, for example, [COMPANY] v [NAME] (1978) 140 CLR 120 and [NAME] v [NAME] (1980) 145 CLR 266. By the late 1970s, the criterion of operation doctrine, which had found expression in [COMPANY] v [NAME] (1953) 87 CLR 1 ("[COMPANY]") and had been accepted for 25 years, was no longer accepted by a majority of the High Court. 209 There were three objections to the criterion of operation doctrine and, since they are [NAME] to the submissions in these appeals, it is useful to note them here. First, the doctrine was said to depend "on the formal and obscure distinction between the essential attributes of trade and commerce and those facts, events or things which are inessential, incidental, or, indeed, antecedent or preparatory to that trade and commerce": [NAME] v [NAME] at 401. Second, the doctrine was thought to place "[NAME] trade on a privileged or preferred footing, immune from burdens to which other trade is subject": [NAME] v [NAME] at 402. Third, the doctrine failed "to make any accommodation for the need for laws genuinely regulating intrastate and [NAME] trade": [NAME] v [NAME] at 403. This led the Court in [NAME] v [NAME] at 403 to observe: The history of the movement for abolition of colonial protection and for the achievement of intercolonial free trade does not indicate that it was intended to prohibit genuine non-protective regulation of intercolonial or [NAME] trade. … [T]here has been a continuing tension between the general application of the formula and the validity of laws which are purely regulatory in character. 210 The history of s 92 since [NAME] v [NAME] indicates that accommodating s 92 with the need for regulatory laws continues to provoke controversy. In a sense, these appeals reflect the tension to which the Court referred. Further, as these appeals indicate, even after [NAME] v [NAME], there is perhaps a tendency in some s 92 analysis to veer towards a preference for [NAME] over other trade; and, as these appeals show, with respect to the identification of [NAME] trade, the attraction of arguments about essence remains. 211 By reference to an historical analysis, [NAME] v [NAME] substantially resolved the controversy over the construction of s 92, by holding that s 92 applied to laws that discriminate against [NAME] trade or commerce in a protectionist sense: see [NAME] v [NAME] at 391-395, 407. Thus, the Court said (at 393): Section 92 precluded the imposition of protectionist burdens: not only [NAME] border customs duties but also burdens, whether fiscal or non-fiscal, which discriminated against [NAME]. That was the historical object of s 92 and the emphasis of the text of s 92 ensured that it was appropriate to attain it. [ADDRESS] held (at 394) that: The history of s 92 points to the elimination of protection as the object of s 92 in its application to trade and commerce. The means by which that object is achieved is the prohibition of measures which burden [NAME] and which also have the effect of conferring protection on [NAME] and commerce of the same kind. The general hallmark of measures which contravene s 92 in this way is their effect as discriminatory against [NAME] in that protectionist sense. The focus in subsequent s 92 cases, as in these appeals, has been on whether the impugned measure is discriminatory in a protectionist sense, as to which the Court in [NAME] v [NAME] gave some guidance. 212 Whilst acknowledging that the concept of discrimination "commonly involves the notion of a departure from equality of treatment", the Court held (at 399) that: It does not follow that every departure from equality of treatment imposes a burden or would infringe a constitutional guarantee of the freedom of [NAME] from discriminatory burdens. Nor does it follow that to construe s 92 as guaranteeing the freedoms of [NAME] from discriminatory burdens would mean that [NAME] was rendered immune from any regulation which did not affect like [NAME]. Such regulation might not constitute a burden at all. Even if it did, it might not be discriminatory in the sense to which we have referred. 213 Further, [NAME] v [NAME] recognized that the question whether or not an exercise of legislative power is invalid in so far as it impermissibly burdens [NAME] may depend on the practical operation of the law. Thus, the Court stated (at 399) that: The concept of discrimination in its application to [NAME] necessarily embraces factual discrimination as well as legal operation. A law will discriminate against [NAME] trade or commerce if the law on its face subjects that trade or commerce to a disability or disadvantage or if the factual operation of the law produces such a result. 214 At issue in [NAME] v [NAME] was the validity of a Tasmanian law that made it an offence to sell undersized crayfish, whether or not taken in Tasmanian waters. Whilst the law burdened [NAME] trade in crayfish, the Court held that the burden was not discriminatory in a protectionist sense. [ADDRESS] explained (at 408) that: [W]here the law in effect, if not in form, discriminates in favour of [NAME], it will … offend against s 92 if the discrimination is of a protectionist character. A law which has as its real object the prescription of a standard for a product or a service or a norm of commercial conduct will not ordinarily be grounded in protectionism and will not be prohibited by s 92. But if a law, which may be otherwise justified by reference to an object which is not protectionist, discriminates against [NAME] trade or commerce in pursuit of that object in a way or to an extent which warrants characterization of the law as protectionist, a court will be justified in concluding that it nonetheless offends s 92. The Tasmanian law was not discriminatory in a protectionist sense because it did not confer a competitive or market advantage over the trade in imported crayfish; and, even if the Tasmanian law advantaged local trade by improving the competitive quality of local supplies, on the agreed facts, the extension of the prohibition to crayfish caught outside the State was "a necessary means of enforcing the prohibition against the catching of undersized crayfish in Tasmanian waters": [NAME] v [NAME] at 409. 215 The basic premise of [NAME] v [NAME] – that s 92 prohibits only discriminatory burdens of a protectionist kind – has not since been doubted, although subsequent decisions have explored its ramifications.

[NAME], [NAME] and [NAME] 216 Prior to the [NAME] cases (see below), after [NAME] v [NAME], whether or not an exercise of legislative power was contrary to s 92 was examined in such subsequent cases as [NAME] v [COMPANY] (1988) 165 CLR 411 ("[NAME]"), [COMPANY] v [NAME] (1990) 169 CLR 436 ("[NAME]") and [NAME]) v [NAME] (1990) 171 CLR 182 ("[NAME]"). In the present appeals, the parties relied on these authorities to support their respective positions. These cases illustrate that there was no departure from [NAME] at the time they were decided. Rather, the ramifications of the principles in [NAME] were explored by reference to the circumstances in each case. Each party drew comfort from what it saw as the ramifications that the Court supposedly accepted. 217 At issue in [NAME] was a [NAME] law that required the payment of [NAME] fees by [NAME] and [NAME]. The [NAME] first imposed a [NAME] fee on [NAME] in respect of tobacco sold to [NAME] [NAME] and, then, a [NAME] fee on [NAME] [NAME] in respect of any tobacco not sold to them by [NAME]. The result was that tobacco products purchased by a [NAME] from a local [NAME] did not attract the extra fee that fell on a [NAME] who purchased from an [NAME[NAME]. The majority concluded that the challenged provisions were relevantly discriminatory because they had the effect of protecting [NAME] and their tobacco from competition from an [NAME] "whose products might be cheaper in some other Australian markets for a variety of possible reasons, e.g., that the laws of the State in which he carries on his business as a [NAME] either do not require that he hold a [NAME] at all or exact a [NAME] fee comparatively lower than the fee exacted from a [NAME[NAME]": [NAME] at 425. That is, the operation of the [NAME] fee provisions was, in practice, discriminatory against the [NAME] trade in tobacco products in a protectionist sense. The majority did not hold, however, that the explanation for the imposition of the burden on [NAME] trade was irrelevant, as [NAME] submitted. On the contrary, the majority considered that explanation and concluded that it underlined, rather than removed, the protectionist character of the provisions: see [NAME] at 426. 218 In [NAME] the High Court held that South Australian legislation, which required [NAME] to collect a refundable deposit from the purchasers of bottled beer, discriminated against [NAME] supplying beer in non-refillable bottles and protected in [NAME] who mostly sold beer in refillable bottles. The legislation provided a higher refund rate for refillable bottles as opposed to non-refillable bottles. The majority summarised the position thus (at 464): The practical effect of the [legislative arrangement] was to prevent [[NAME]] obtaining a market share in packaged beer in [NAME] in excess of 1 per cent whilst their competitors used refillable beer bottles. … It is common ground between the parties that the object and effect of the [legislation] was to make the sale of beer in non-refillable bottles commercially disadvantageous. … [[NAME]] claims that the [legislative arrangement] promoted litter control and conserved energy and resources. [ADDRESS] held that the South Australian legislation was discriminatory in a protectionist sense and, in so doing, developed the analysis required by s 92. First, the judgment of five members of the Court emphasized that the Australian approach was different from the American commerce clause analysis. Their Honours stated (at 471): [W]e are concerned only with the proper characterization of the law as protectionist or not, in the sense described in [NAME] v [NAME]. Hence there is no place for a secondary test to invalidate laws which have been found to lack a protectionist purpose or effect. Rather, the two tests are combined as one inquiry into the characterization of the law as protectionist or otherwise. 220 Since the critical question in [NAME] [NAME] was whether the discriminatory burden imposed on [NAME] trade by the South Australian legislation was of a protectionist kind, their Honours specifically dwelt on the characterization process. Relevantly for these appeals, their Honours said (at 471): [T]he fact that a law regulates [NAME] and [NAME] evenhandedly by imposing a prohibition or requirement which takes effect without regard to considerations of whether the trade affected is [NAME] or intrastate suggests that the law is not protectionist. Likewise, the fact that a law, whose effects include the burdening of the trade of a particular [NAME], does not necessarily benefit local [NAME], as distinct from other [NAME], suggests that the purposes of the law are not protectionist. On the other hand, where a law on its face is apt to secure a legitimate object but its effect is to impose a discriminatory burden upon [NAME] trade as against [NAME], the existence of a reasonable non-discriminatory alternative means of securing that legitimate object suggests that the purpose of the law is not to achieve that legitimate object but rather to effect a form of prohibited discrimination. There is also some room for a comparison, if not a balancing, of means and objects in the context of s 92. The fact that a law imposes a burden upon [NAME] that is not incidental or that is disproportionate to the attainment of the legitimate object of the law may show that the true purpose of the law is not to attain that object but to impose the impermissible burden. 221 In so far as the present appeals are concerned, it is important to note that the Court scrutinised both the rationale for, and operation of, the impugned legislative measures. If, so their Honours reasoned (at 473-474), the legislative measure was "appropriate and adapted to the protection of the environment in [NAME] from the litter problem and to the conservation of the State's finite energy resources and … its impact on [NAME] trade [was] incidental and not disproportionate to those objects", then the burden would not be characterized as protectionist. In the result, their Honours held (at 477) that "neither the need to protect the environment from the litter problem nor the need to conserve energy resources offer[ed] an acceptable explanation or justification for the differential treatment given to the products of [out-of-state] brewing companies". The challenged legislative measures were therefore discriminatory in a protectionist sense in relation to [NAME] trade. 222 [NAME] concerned the establishment, by [NAME] legislation, of a [NAME]. [NAME] particularly relied on its authority, because it concerned the establishment of a [NAME] in a market that did not offend s 92. Pursuant to the legislation, barley grown by [NAME] was vested in the board, which sold the barley and returned the benefit of the sale to the growers. The result of the marketing scheme was that [NAME] were unable to buy barley as cheaply as they had formerly done from individual growers. This was consistent with the object of the legislation since the board had been established to achieve a collective increase in market power to support higher prices "especially [to] [NAME] maltsers", although the higher prices were charged to both intrastate and [NAME] [NAME]: see [NAME] at 202 ([NAME] [NAME], [NAME] and [NAME] [NAME]). 223 After discussing cases in which marketing schemes had previously been held to conflict with s 92, the Court said (at 201): The decisions to which we have referred proceeded according to the so-called "individual rights" theory of s 92, namely, that the section guarantees the right of the individual to engage in [NAME]. That view of s 92 prevailed until it was displaced by [NAME] where it was pointed out that the "individual rights" theory has the effect of transforming s 92 into a source of discriminatory protectionism in reverse … Once that view was displaced by the interpretation adopted in [NAME] v [NAME], it necessarily followed that the authority of earlier decisions of the Court, including the [Peanut Board v [NAME] (1933) 48 CLR 266, [COMPANY] v [NAME] Authority ([NAME]) (1975) 134 CLR 559 and [COMPANY] v [NAME] (1985) 157 CLR 605], was open to question to the extent to which those decisions were decided by reference to an interpretation of the section that could no longer be supported. [ADDRESS] applied the principles as formulated in [NAME] to conclude that the legislation did not impose a discriminatory burden of a protectionist kind on [NAME]. [ADDRESS] explained (at 203): The maltsers in both [NAME] are denied direct access to the growers in [NAME]. The Act does not result in the exclusion of one group but not the other from any market; nor does the Act lead to any difference in price of product to malsters in the two [NAME]. Consequently the [NAME] malster is given no competitive advantage over his [NAME] counterpart. So the operation of the Act does not result in "a departure from equality of treatment" of [NAME] and [NAME] and commerce, that being the object of the constitutional injunction in s 92.

The [NAME] cases 225 At the hearing of these appeals, the parties differed as to the significance they attached to [COMPANY] v [NAME] (2008) 234 CLR 418 ("[NAME]"), which at the time of argument was the most recent decision of the High Court concerned with s 92. [NAME] illustrates that, whilst the construction of s 92 has not altered since [NAME] v [NAME], s 92 may be invoked over time in very different circumstances. 226 [NAME] operated a betting exchange pursuant to a [NAME] under Tasmanian law, from premises in Tasmania for [NAME] throughout Australia. [NAME]'s customers communicated with it via telephone and the internet. [NAME] challenged the validity of Western Australian legislation specifically targeted to prevent people in [NAME] from using its [COMPANY]: see [NAME] at 470-472 [68]-[77], 478 [106], 480 [114]. In this latter regard, [NAME] was not dissimilar to the measures considered in [NAME]. [ADDRESS] held that the State's legislation was invalid by reason of s 92, to the extent that it would prevent the use of [NAME]'s betting exchange via telephone or internet: see [NAME] at 473 [83]-[84] ([NAME] [NAME], [NAME], [NAME], [NAME], [NAME] and [NAME]) and 487-488 [141]-[146] ([NAME[NAME]). 227 Contrary to [NAME]'s submissions, [NAME] did not involve any re-consideration of [NAME] v [NAME] and, as the joint judgment of [NAME], [NAME] and [NAME[NAME] noted, the source of s 92 jurisprudence remained [NAME], as developed and applied in [NAME], [NAME] and [NAME]: see [NAME] at 451 [10]. Relevantly for these appeals, their Honours' decision ultimately depended on the application of the established principle that "a law the practical effect of which is to discriminate against [NAME] trade in a protectionist sense is not saved by the presence of other objectives … which are not protectionist in character": see [NAME] at 464 [47]. 228 Also relevantly for these appeals, [NAME] reaffirmed that s 92 is not concerned with the individual rights of [NAME] that carry on [NAME] trade or commerce: [NAME] at 456 [26]. In their joint judgment, six of their Honours specifically accepted "s 92 was not designed to create 'a laissez-faire economy in Australia'; rather, it had a more [COMPANY] operation, to prevent the use of State boundaries as trade borders or barriers for the protection of intrastate players in a market from competition from [NAME] players in that market": [NAME] at 460 [36]. 229 [NAME] may perhaps be read as departing from [NAME] in relation to the appropriate and adapted test, referred to by the State as the negative criterion for determining whether or not a measure was a protectionist one. In their joint judgment at 476 [98]-[99], six members of the Court expressed dissatisfaction with a passage in [NAME] concerned with the appropriate and adapted criterion and subsequently used an alternative formulation of the negative criterion – that of reasonable necessity. 230 At the same time, the joint judgment indicated that there was to be no departure from the substance of the approach in [NAME]: see [NAME] at 476 [100]. Consistently with [NAME] and [NAME], their Honours accepted (at 476-477 [101]-[102]) that the appropriate and adapted criterion necessarily involved: … the existence of a "proportionality" between, on the one hand, the differential burden imposed on an out-of-State producer, when compared with the position of in-State producers, and, on the other hand, such competitively 'neutral' objective as it is claimed the law is designed to achieve. Indeed, their Honours' reference to the criterion of reasonable necessity first appeared in their elaboration of "proportionality" in the above passage. Thus, citing [COMPANY] v [NAME] Authority of [NAME] (1975) 134 CLR 559, decided pre-[NAME], their Honours said (at 477 [102]): That "proportionality" must give significant weight to the considerations referred to earlier in these reasons when discussing [NAME]. These involve the constraint upon market forces operating within the national economy by legal barriers protecting the domestic producer or [NAME] against the out-of-State producer or [NAME], with consequent prejudice to domestic customers of that out-of-State producer or [NAME]. They suggest the application here, as elsewhere in constitutional, public and private law, of a criterion of 'reasonable necessity'. (Emphasis added) Their Honours went on to state that this "view of the matter should be accepted as the doctrine of the Court": [NAME] at 477 [103]. 231 The reference in the above passage to the criterion of reasonable necessity elsewhere in constitutional, public and private law signalled what was intended in this context by the reasonable necessity criterion: see the discussions in, for example, [NAME] (2007) 233 CLR 307 ("[NAME]") at 331-333 [21]-[24] ([NAME] [NAME]); and [NAME] v [NAME] Commission (2004) 220 CLR 181 ("[NAME] v [NAME]") at 199-200 [39] ([NAME]), which was cited with approval in Hogan v Hinch (2011) 85 ALJR 398 ("Hogan v Hinch") at 418 [72] ([NAME], [NAME] and [NAME]). Read in this light, the criterion of reasonable necessity was, as their Honours indeed observed, consistent with [NAME] and [NAME]: see [NAME] at 477-478 [103]-[105]. Hence, in [NAME], the criterion of reasonable necessity operated in much the same way as the appropriate and adapted criterion. Both criteria involved consideration of whether the burden imposed by the impugned measure was greater than that required for the reasonable attainment of the purpose that provided the "acceptable explanation or justification" for the measure. [NAME] at 477 and [NAME] at 478-480 [106]-[113]. Both criteria involved the same kind of considerations. Neither formulation required a showing that the burden on [NAME] is absolutely necessary to achieve the legitimate purpose of the measure: see, with respect to reasonable necessity, [NAME] v [NAME] at 331-333 [21]-[24] and [NAME] v [NAME] at 199 [39]. 232 Further, in [NAME] the assessment in the joint judgment of the competing considerations [NAME] to the negative criterion established that there was to be no significant departure from the [NAME] v [NAME] approach. Noting that [NAME] sought to justify the challenged measures on the basis they dealt with a threat to the integrity of [NAME], their Honours concluded (at 479-480 [110]-[112]): [A]llowing for the presence to some degree of a threat of this nature, a method of countering it, which is an alternative to that offered by prohibition of betting exchanges, must be effective but non-discriminatory regulation. That was the legislative choice taken by Tasmania and it cannot be said that that taken by [NAME] is necessary for the protection of the integrity of [NAME] of that State. In other words, the prohibitory State law is not proportionate; it is not appropriate and adapted to the propounded legislative object. Part 4A of the Tasmanian Act contains the detailed regulatory provisions which the Treasurer had outlined. It does not discriminate against [NAME]. Counsel for Tasmania points to evidence which indicates that the prescribed standards have been fully satisfied by [NAME]. Seen from the other perspective, there was a lack of evidence of any increase in Australia of dishonest practices attributable to the operation of the betting exchange by [NAME]. It will be recalled that [NAME]'s exchange remains accessible under the laws of the other [NAME]. In that setting, it cannot be found in this case that prohibition was necessary in the stated sense for the protection or preservation of the integrity of [NAME]. (Emphasis added.) 233 This analysis is consistent with the approach in [NAME] and, indeed, [NAME]. The passage indicates that the reasonable necessity and appropriate and adapted criteria are substantially interchangeable and, on one view, it is of little practical significance which formulation is employed providing the correct process of assessment is made. Relevantly for these appeals, however expressed, the negative criterion would involve a notion of proportionality between the discriminatory burden on the one hand and the legitimate purpose of the impugned measure on the other. 234 After argument and whilst judgment was reserved, the High Court delivered judgment in [NAME] and [COMPANY] v [NAME] (2012) 286 ALR 221 ("[NAME]"). [ADDRESS] invited the parties to file supplementary submissions to address the significance of these decisions for these appeals, which they duly did. As the High Court indicated, the reasons for judgment in [NAME] and [NAME] are to be read together. The two cases show that the Court continues to adhere to the principles of construction formulated in [NAME] and explored in the subsequent cases to which refer has been made. 235 [NAME] concerned the validity of the imposition of a fee as part of a legislative regime pursuant to which [NAME] were unable to use [NAME] race field information without the approval of the [NAME] [NAME] control body. [NAME] argued that the fee – calculated as a percentage of [NAME] turnover on the [NAME] races – had a greater impact on it than [NAME] (such as the [COMPANY]) with different business models; and that, in consequence, the requirement to pay the fee was a discriminatory burden of a protectionist kind in breach of s 92. 236 [NAME] concerned the same legislative regime as [NAME], save that [NAME] challenged the regime on a broader front and, as on these appeals, in reliance on s 49 of the Self-Government Act and s 109 of the Constitution. [NAME] sought declarations of invalidity of the [NAME] legislative provisions and also of the conditions of approval requiring the payment of fees, on the ground that the impugned measures imposed a burden on trade and commerce between the [NAME] and [NAME] not imposed on [NAME] and commerce of the same kind; and that the effect of these measures was to protect [NAME] in [NAME] from competition from [NAME] in the [NAME]. 237 In a [NAME] judgment in [NAME] at 231-232 [36]-[37], [NAME], [NAME] and [NAME] reaffirmed the principle acknowledged in the earlier cases that: Not every measure which has an adverse effect between competitors will attract the operation of s 92. The "confined area" in which s 92 operates was emphasised in [NAME] v [NAME]. [NAME] must establish that the fee conditions imposed upon it by [the [NAME]] were unauthorised because their practical effect is to discriminate against [NAME] trade and thereby protect [NAME] of the same kind. What is posited here is an essentially objective inquiry. It is the concept of protectionism which supplies the criterion by which discriminatory laws may be classified as rendering less than absolutely free trade and commerce among the [NAME]. … It is important to note, as emphasised in [NAME] [at 407-8], that whether a facially neutral law in question is discriminatory in effect, and whether the discrimination is of a protectionist character, "are questions raising issues of fact and degree". The [NAME] judgment held that the fact that [NAME] operated in a national market and that the challenged measure sought to regulate its activities in that market did not call for a departure from the settled approach to s 92: see [NAME] at 236 [57]; and 247-249 [100]-[109], 252-253 [123]-[127] ([NAME[NAME]). One must, therefore accept that, as [NAME] argued on these appeals, the existence of a national market for [NAME] [COMPANY] does not alter the fundamental principles [NAME] to the operation of s 92. 238 As the judgments in [NAME] make clear, the subject of s 92 is trade, not [NAME]: see [NAME] at 233 [46] ([NAME], [NAME], [NAME] and [NAME]), 237 [60], 239 [68]-[69] ([NAME[NAME]), 250 [114] ([NAME]). The [NAME] judgment is plain that there is no place for an "individual rights" approach in contemporary s 92 jurisprudence: see [NAME] at 231 [36] and 232-233 [42]; also 239 [68]-[69] ([NAME[NAME]), 249-250 [110]-[112] ([NAME[NAME]). Thus, the fact that, on [NAME]'s argument, the burden imposed on it was greater than on others because of its business model did "not mandate an outcome" in its favour: see [NAME] at 233 [44]; and to similar effect, see [NAME] at 411 [20]. Rather, for s 92 purposes, the [NAME] inquiry is whether there is discrimination against [NAME] trade, which may affect one or a number of [NAME]. An [NAME] can be no more than a surrogate or representative of the trade in which the [NAME] participates and that is said to be the subject of the contested measure. 239 Applying the established principles with respect to the construction of s 92, [NAME] failed to show that the impugned legislation was discriminatory against [NAME] trade in a protectionist sense. As the [NAME] noted, there was there no counterpart to that part of the case stated in [NAME] affirming that "[t]he object and effect of the [regime] had been to make the sale of beer in non-refillable bottles commercially disadvantageous". Similarly, in [NAME] the [NAME] held (at 415 [36]) that, as a matter of fact, [NAME] failed to make out a case of [NAME] discrimination. 240 [NAME] and [NAME] are plainly very different cases from [NAME]. [NAME] turned on the Court's conclusion that, in the circumstances disclosed to it, the challenged provisions sought to create a barrier to entry into the Western Australian market, and the Court considered the position of the [NAME] that wished to enter the market because that [NAME]'s trade was barred by virtue of the barrier: see [NAME] at 224 [6] ([NAME], [NAME], [NAME], [NAME] and [NAME]) and 251 [121] ([NAME]). 241 In contrast to [NAME], in [NAME], the [NAME] explained at 235-236 [55]-[56]: The circumstance that the fee structure adopted by [NAME] for its [NAME] operations differed from that adopted by other [NAME] did not constitute a [NAME] difference which, consistently with s 92, could not be disregarded by treating alike [NAME] and intrastate [NAME] transactions utilising [NAME] race field information. All that [NAME] established was that by maintaining its current pricing structures, and given its low margin, the fees imposed by [the [NAME] [NAME]] absorbed a higher proportion of its turnover on [NAME] transactions than that of the turnover of the [NAME], the principal intrastate [NAME]. Nor did [NAME] demonstrate that the likely practical effect of the imposition of the fees will be loss to it of market share or profit or an impediment to increasing that share or profit. (Emphasis added) 242 As will appear in the following discussion, the current appeals are more akin to the circumstances considered in [NAME] and [NAME] than in [NAME].

QUESTIONS TO WHICH THE [NAME] 243 Having regard to the [NAME] judgment in [NAME] at 234-235 [52], these appeals give rise to the following broad questions: 1. whether the impugned provisions in their terms or practical operation discriminate against trade or commerce between the [NAME] because: (a) they draw a distinction in terms between [NAME] and commerce and trade and commerce between the [NAME], otherwise than by reference to a [NAME] difference between them; (b) they do not draw a distinction in terms between [NAME] and commerce and trade and commerce between the [NAME], notwithstanding a [NAME] difference between them; or (c) their practical operation shows that the objective intention of the legislature was to achieve the effect in (a) or (b); 2. if so, whether the impugned provisions burden trade and commerce between the [NAME] to its competitive disadvantage or to the competitive advantage of [NAME] and commerce; and 3. if so, whether that burden is nonetheless reasonably necessary or appropriate and adapted for the State to achieve a legitimate non-protectionist purpose?

Discrimination against trade or commerce between the [NAME] or commerce between the [NAME]? 244 The subject of s 49 of the Self-Government Act is, relevantly, trade between the [NAME] and the [NAME], in this case, [NAME]. When s 49 is invoked in a challenge such as this, whether or not trade is characterised as intrastate or between the [NAME] is essentially a question of fact and degree, to be determined by reference to the substance of the transactions that constitute the trade said to be burdened by the impugned measures. 245 Section 49 of the Self-Government Act cannot be engaged in these appeals unless the impugned provisions burden trade between the [NAME]. [NAME] submitted that the impugned provisions did not relevantly affect trade between the [NAME]. If this submission were accepted, then s 49 would have no application. 246 [NAME] argued that [NAME]'s installation of a [NAME] at [COMPANY] was functionally equivalent to establishing a [NAME] outlet in the State. Thus, so the argument ran, when a [NAME] placed a bet with a [NAME] service provider at a [NAME] shop in the State and when a [NAME] placed a bet with [NAME] via a [NAME], the [NAME] was engaged in [NAME]. On this argument, the basic transaction was the provision of a [NAME] service at the place where [NAME] was installed. 247 As the authorities show, the subject of s 49 of the Self-Government Act is not [NAME], whose trade may consist of in-State transactions and transactions between the State and the [NAME] (and elsewhere). Hence, the cross-border elements of the [NAME]'s business that belong to transactions outside the trade in question do not bear on whether that trade attracts the protection of s 49. Consideration of matters such as the location of the [NAME]'s principal office and senior management, or the [NAME]'s infrastructure and business model, distracts attention from the [NAME] inquiry, which first requires identification of the transactions constituting the [NAME] trade. This is borne out by the [NAME] judgment in [NAME] at 410 [17] and [NAME] at 233-234 [46], particularly the reference (at 234 [49]) to [COMPANY] v [NAME]) (1940) 64 CLR 169. The [NAME] described that case in the following terms: The taxpayer … was incorporated in [NAME], where its [NAME] was located. But it carried on business as a draper at [NAME] shops in four [NAME] including [NAME] and [NAME]. [ADDRESS] held that where a business ordinarily consists of selling goods (and, it might have been added, of supplying [COMPANY]), the contracts with consumers are of the essence of the business. The result was that, despite the location in [NAME] of the [NAME], the taxpayer carried on trade in [NAME] where contracts were made and it derived income in that State. On these appeals then, the question whether s 49 is attracted at all first depends on the identification of trade between the [NAME] that is said to be burdened, and not on the cross-border character of [NAME]'s organisation and business as a whole. This depends on the relationship between the impugned provisions and the trade said to be affected by them. 248 It can readily be accepted that the movement of goods across borders between the [NAME] and the [NAME], and the commercial transactions of which the movement is the direct result, constitutes trade and commerce between the [NAME] and the [NAME]: compare [COMPANY] v [NAME] (1985) 157 CLR 605 ("[NAME]") at 626-627. Plainly enough, as well as the movement of goods, trade and commerce between the [NAME] and the [NAME] can involve intangibles, including, as [NAME[NAME] said in [NAME] (at 628), "the telegraph, the telephone, broadcasting, television, communications, the transmission of intelligence and those aspects of banking and the provision of [COMPANY] which involve movement across State boundaries" (emphasis added). See also [COMPANY] v The Commonwealth (1948) 76 CLR 1 ("the Banking Case") at 380-381, approved in The Commonwealth v [COMPANY] (1949) 79 CLR 497 at 632-633. Today, no doubt his [NAME] would add the trans-border transmission of [COMPANY] by internet, as in [NAME]. 249 Considered from the [NAME]'s perspective, [NAME]'s installation of a [NAME] at [COMPANY] was akin to [NAME]'s establishing a [NAME] outlet in [NAME]. It was immaterial to the [NAME] whether the bet was processed by one of [NAME]'s servers in Darwin or elsewhere: compare [COMPANY] v [NAME] [COMPANY] [2003] 1 WLR 1462 at 1471 (CA). From [NAME]'s perspective, the processing of the bet by its servers at its licensed premises in Darwin was important because it thereby acted under its [NAME] under the [NAME]) and in accordance with the law of the [NAME] that allowed it to undertake its [NAME] business in the first place. 250 The perspectives of the [NAME] and the [NAME] are not, however, determinative, although they do serve to direct attention to what is important – the transactions involved in the [NAME] trade. Focusing on these transactions, it is apparent that there is a provision of [NAME] [COMPANY] across [NAME] borders. The [NAME], who has [NAME] with [NAME], selects the race on which the [NAME] wants to bet, nominates the amount and kind of bet and electronically sends a request to [NAME]. [NAME] receives the request, via its servers, at its licensed premises in Darwin, where the bet is processed and accepted. [NAME] sends, electronically, a notification of acceptance to [NAME] where it is read by the [NAME] in [NAME]. These transactions are repeated whenever a bet is sought to be placed with [NAME] via a [NAME] in [NAME]. They are the transactions that constitute the trade said to be burdened by the impugned provisions. Since the trade involves the provision of [NAME] [COMPANY] across [NAME] borders or, as the [NAME] judge would have it, the movement of intangibles, the trade is relevantly between the State and the [NAME]. 251 [NAME] relied on [COMPANY] (see [208] above) in support of the contrary conclusion that the transactions constituting the trade were intrastate transactions. In that case, the [COMPANY] ([COMPANY]) challenged the validity of a [NAME] statute that required the registration of hospital and medical benefits associations. [COMPANY], a company incorporated in [NAME] to provide health insurance, was held not to engage in [NAME] trade, notwithstanding that it had contracted with [NAME] to pay benefits and hospital fees anywhere in Australia if they incurred medical and hospital expenses and some [NAME] lived outside [NAME]. The High Court held that the [COMPANY] was not engaged in [NAME] trade because "[n]either the contract nor its performance contemplates or of its nature involves the movement from one place to another of things tangible or intangible, and certainly not from a place in one State to a place in another": see [COMPANY] at 15 ([NAME] [NAME], with whom [NAME[NAME] agreed). That is, because the contract did not expressly provide for the movement of goods, [COMPANY] or other intangibles across State boundaries, there was no [NAME] trade. Further, as [NAME] remarked, "the contingencies against which the contract provides have nothing of the character of inter-State commerce or intercourse": [COMPANY] at 15; also 39 ([NAME[NAME]), 45 ([NAME]). It was also irrelevant that [COMPANY] organised and administered its business across State boundaries. 252 As [NAME] noted, the reasoning in [COMPANY] was applied, with respect to the application of s 92, in [COMPANY] v [NAME] (1977) 136 CLR 475 ("[NAME]") in relation to a [NAME] of refinery exchange: [NAME] at 506. The exchange did not contemplate either the cross-border movement of petroleum products, "or for that matter the movement [NAME] of debits and credits": see [NAME] at 506-507 ([NAME[NAME], with whom [NAME] and [NAME] [NAME] agreed). (This aspect of the case was not apparently affected by Ha v [NAME] (1997) 189 CLR 465.) In [NAME] v [COMPANY] (1989) 168 CLR 461 ("[NAME]") at 539-540, [NAME[NAME] expressly adapted [NAME]'s reasoning in [COMPANY] to deny that a barrister could be characterised as engaged in [NAME]. 253 As earlier observed, [COMPANY] marked the Court's acceptance of the criterion of operation analysis, which was formally rejected in [NAME]. [NAME] sought to circumvent this objection with the submission that the ruling on [NAME], referred to above, formed part of the ratio of the case, but did not depend on the criterion of operation doctrine. That the ruling formed part of the ratio may be accepted; and, whilst the criterion of operation test may resonate in some of the language [NAME] used in characterising the trade that was subject to the challenged legislation, his [NAME]'s approach to characterisation was not substantially affected by that test. This approach involved considering the relation of the legislation in question to the trade said to be burdened by it. Since in [COMPANY] the challenged legislation applied because of the nature of the business that the company carried on, the focus was on that business. Since the "essence of the business" from the company's point of view was "the making of contracts involving … the receipt of money and … the payment of money on the occurrence of certain contingencies", these contracts and contingencies were determinative of whether the business of the company was characterised as in [NAME] trade: see [COMPANY] at 14-15. 254 A similar approach in [NAME] was also appropriate because of the nature of the measure under challenge. [NAME] [NAME] adaption in [NAME] of [NAME]'s language in [COMPANY] should be understood as no more than an elucidation of his [NAME]'s view of the essentially local character of a barrister's practice. 255 Furthermore, although it may not matter, when the reasons for judgment of [NAME] in [COMPANY] are read as a whole, it is difficult to resist the conclusion that some, at least, of the language in the passages on which [NAME] relied were written with the criterion of operation doctrine in mind and that this doctrine suffused his [NAME]'s reasoning. The doctrine continued to hold sway when [NAME] was decided. 256 The impugned provisions in these appeals are of a different character. They do not involve the consideration of [NAME]'s business as a whole or of its [NAME] contracts in particular. Rather, the impugned provisions have a much narrower focus and the passages (in [COMPANY] at 14-15) upon which [NAME] rely do not assist them. The focus of the impugned provisions is on [NAME] (GRA, s 2.5.2; cf LCRA s 115) or instruments of betting (GRA, s 2.6.1). The [NAME] inquiry is, therefore, as to the relation between the operation of these provisions and trade between the [NAME]. The simple fact that the provisions have a local, within-State operation is not enough to show that they do not burden this trade, although it does mean that the inquiry is relevantly different from [COMPANY], and that the reasoning in that case on which [NAME] relied does not assist them. 257 In the present appeals, [NAME] contends that there is a cross-border provision of [NAME] [COMPANY] made by: (1) the cross-border movement of [NAME] information between the [NAME] in [NAME] and [NAME] in the [NAME] (involving the selection, placement and notification of acceptance of wagers) via the electronic transmissions between [NAME] used by [NAME] in [NAME] and [NAME]'s servers in Darwin; (2) the acceptance of the wagers in the [NAME] from [NAME] in [NAME]; and (3) the associated financial transactions in respect of the wagers received from these [NAME] effected on an account maintained in the [NAME]. [NAME], [NAME] and, earlier still, the Banking Case support the conclusion that these elements involve transactions in [NAME] and, thus, in this case, transactions in trade between the [NAME]. [NAME] at 628; the Banking Case at 289 ([NAME] and [NAME]) and 380, 383 ([NAME]); and cf [NAME] at 481 [118]. 258 These considerations lead to the rejection of [NAME]' submission that [COMPANY] justifies a finding that the impugned provisions did not relevantly affect trade between the [NAME] and in consequence [NAME] trade was not involved. The [NAME] judge was correct to hold that the placement and acceptance of wagers via electronic transmissions (and the associated financial transactions) constituted trade between the State and the [NAME]: [NAME] at 445 [92].

The nature of the burden 259 [NAME] claimed that ss 2.5.2 and 2.6.1 of the GRA and s 115 of LCRA burdened [NAME]'s trade between the [NAME] by prohibiting [NAME] from using and installing a [NAME] in [NAME] as an element of its trading operations between the State and the [NAME]. This much may be accepted. 260 [NAME] also asserted that the impugned provisions burdened [NAME] communications. This was not a case that [NAME] had previously pleaded or, indeed, apparently argued at first instance. In any event, as [NAME] noted, the impugned provisions did not prohibit or restrict communication with [NAME]'s servers in Darwin or elsewhere. Thus, the impugned provisions do not affect communications with [NAME]'s servers via a computer or mobile phone. The impugned provisions did not attach to the use of a [NAME] merely because [NAME] was the means by which a bet was communicated to [NAME]. Rather, in the [NAME] judge's words, "[t]he sole, dedicated and public use of the "[NAME]" is to facilitate betting" and [NAME] "is the means by which the bet is selected, placed and its acceptance is notified": see [NAME] at 434 [40]. It would therefore be erroneous to characterise the burden that the impugned provisions impose in the way that [NAME] proposed. 261 It is convenient here to note [NAME]'s argument that there was no [NAME] burden because the impugned provisions only prohibited [NAME] from doing that which it could not do under its [NAME] in any event. Hence, so [NAME] said, the impugned provisions did not prevent [NAME] from operating its business in the manner it was entitled to do. For the reasons already stated (at [198] above), this argument was misconceived. In any event, whether or not [NAME] can use a [NAME] in the [NAME] does not answer the question whether the impugned provisions burden its trade between the [NAME] by preventing its use of a [NAME] in [NAME].

Discrimination against [NAME] – State trade 262 The critical question at this stage is whether, in imposing this burden, the impugned provisions in their terms or practical operation discriminate against trade or commerce between the [NAME]. As [NAME] and [NAME] [NAME] explained in [NAME] at 478: A law is discriminatory if it operates by reference to a distinction which some overriding law decrees to be irrelevant or by reference to a distinction which is in fact irrelevant to the object to be attained … A law is also discriminatory if, although there is a [NAME] difference, it proceeds as though there is no such difference, or, in other words, if it treats equally things that are unequal – unless, perhaps, there is no practical basis for differentiation. 263 None of the impugned provisions in terms discriminate against trading or commercial transactions in goods or [COMPANY] between the [NAME] as compared with intrastate trading or commercial transactions in the same or substitutable goods or [COMPANY]. 264 [NAME] aside, in their practical operation as well as in terms, the impugned provisions treat all [NAME] equally, irrespective of whether they engage in [NAME] or trade between the State and the [NAME] or elsewhere. No-one can operate as [NAME] in [NAME] unless [NAME] under the GRA and, if [NAME], may only engage in bookmaking while at a racecourse in [NAME] licensed under the [NAME]. [NAME] is in the same position as any unregistered [NAME]. [NAME] sought to avoid this difficulty by asserting that all [NAME] other than [NAME] were de minimis. This, as the State noted, was not borne out by the evidence at [NAME]. There is, moreover, nothing to preclude [NAME] wishing to engage in [NAME] – State trade from obtaining registration under the GRA. Even when [NAME], however, no [NAME], whether engaged in [NAME] or out-of-State trade can conduct off-course business by means of a [NAME] or similar device. 265 This led [NAME] to submit that [NAME] is, in effect, seeking an advantage for itself that is not enjoyed by any other [NAME] (save perhaps for [NAME], whose position is discussed below) on the basis that it is engaged in out-of-State trade. [NAME] argued that [NAME]'s case, if accepted, would place out-of-State trade in a more advantaged position than [NAME], which would continue to be subject to the prohibitions in the impugned provisions. [NAME] submitted that [NAME]'s case, if accepted, would reintroduce individual rights jurisprudence for the protection afforded by s 92 and s 49 of the Self-Government Act. For the reasons elaborated hereafter, [NAME]' submissions should be accepted. 266 The [NAME] judge identified discrimination against out-of-State trade on the assumption that it was easier for a [NAME] to conduct business from a [NAME] racecourse than for an out-of-State [NAME]. Thus, [NAME] held that the exception to s 2.5.2 for [NAME] favoured [NAME] "by requiring [NAME] to be present at a racecourse in [NAME]": see [NAME] at 446-497 [100] (emphasis in original). There was, however, no evidence that it was easier for a [NAME] to conduct business from a [NAME] racecourse than [NAME] like [NAME] engaged in trade between [NAME] and the [NAME]. In [NAME]'s case too, the evidence was that its main administration was based in [APPELLANT]. In these circumstances, the [NAME] judge's assumption would not appear sustainable. 267 In any event, the impugned provisions apply only if [NAME] seeks to establish a physical presence in [NAME], as [NAME] seeks to do by means of the installation of a [NAME]. The [NAME] question in this context is whether, if [NAME] has a physical presence in [NAME], the requirement that the [NAME] be present at a racecourse and not elsewhere in [NAME] is more difficult for an out-of-state [NAME] like [NAME] than an intrastate [NAME]. There is no reason to suppose that this might be so. Further, if a requirement that all [NAME] (save [NAME], discussed below) conduct their business at a particular location in the State necessarily infringes s 92 of the Constitution and s 49 of the Self-Government Act, then the State can determine the place where intrastate [NAME] locate their business, but cannot do the same for [NAME] engaged in trade between [NAME] and the [NAME] (or elsewhere) even though they are physically in [NAME]. This would restore out-of-State trade and [NAME] to the privileged position that they enjoyed when the individual rights theory of s 92 held sway. 268 As [NAME] and [NAME] illustrate, not every adverse effect on business amounts to discrimination. The fact that the impugned provisions preclude [NAME] from conducting its business in [NAME] by means of a [NAME] is insufficient in and of itself to attract s 49 of the Self-Government Act. Neither s 92 nor s 49 protects the right of the out-of-State [NAME] to use any particular business model, such as conducting business through a [NAME]: see [NAME] at 232-233 [42] and 247 [103], 248 [105]; also [NAME] v [NAME] at 388 [103]. This was the substance of [NAME]'s complaint: see, e.g., [269] below. The [NAME] judge was mistaken in holding that the disadvantage imposed on [NAME] did not "hinge upon [NAME]'s particular circumstances or business model": see [NAME] at 451 [125]. In this subsidiary argument, [NAME] failed to establish that the impugned provisions operated to discriminate against trade between the [NAME]. 269 [NAME]'s principal argument was that the impugned provisions discriminated against trade between the [NAME] in their practical operation because the impugned provisions did not apply to [NAME]. Much of this argument assumed that trade between [NAME] [NAME] and [NAME] by means of a [NAME] or similar device was properly treated as a proxy for [NAME], and that trade between [NAME] [NAME] and [NAME] was a proxy for [NAME]. This assumption underpinned [NAME]'s central complaint that [NAME] was "permitted recourse to a particular and effective means of communication with its customers ([NAME]), whereas [[NAME] was] prohibited from doing so ([NAME])". 270 The proposition that [NAME] is a proxy for trade between the [NAME], whilst [NAME] is a proxy for [NAME] does not withstand analysis. As [NAME] demonstrated at 232-233 [42], [44], an individual out-of-State [NAME] such as [NAME] cannot rely on the particular circumstances of its business activities – in this instance a desire to use a [NAME] as part of its business activities – to characterise a law as effecting practical discrimination against [NAME] trade or, as here, trade between the [NAME]. As [NAME] demonstrates, this would involve a return to the individual rights theory of s 92: see [NAME] at 232-234 [42]-[50] and 248 [105]. Something more must be shown to constitute an infringement of the protected freedoms. 271 An [NAME] is a convenient proxy for the [NAME] trade where, because of the nature of the challenged measures and the transactions to which they apply, the transactions of a [NAME] affected by the measures are necessarily in [NAME] trade (or, in the case of s 49, in trade between the [NAME] and the [NAME]); or in [NAME] and commerce. In such a case, the validity of a measure can, in consequence, be tested by reference to its operation on that [NAME]. [NAME], [NAME] and [NAME] are illustrative of this kind of analysis. Some care needs to be taken, however, in treating a [NAME] as representative of [NAME] trade (or, here, trade between the [NAME]) lest s 92 and, by extension, s 49, are turned into provisions for the protection of the individual rights of [NAME] that carry on such trade or commerce, as [NAME] and [NAME] confirm. 272 In the present case, [NAME] fails to show that the circumstances of its own trading activities make it a proxy for trade between the [NAME]. There are two reasons for this failure. First, the evidence did not support the conclusion that, by reason of its internal organisation or its business undertaking, [NAME] was properly seen as a proxy for trade between the [NAME]. The evidence established that, although [NAME] in the [NAME], licensed as [NAME] under [NAME] legislation and carrying on some business in the [NAME], [NAME] also carried on business in [NAME], where its senior management was located. In the words of the [NAME] in [NAME], [NAME] was a [NAME] that conducted its business from more than one "particular political and geographical subdivision in Australia", both within those subdivisions and across their borders: see [NAME] at 410 [17]. As a consequence, [NAME] failed to show that its business was in substance merely a [NAME] business. 273 Second, whether or not [NAME]'s undertaking is in substance a [NAME] business, the impugned provisions do not provide any basis for treating [NAME] as a proxy for trade between the [NAME]. So far as these appeals are concerned, [NAME] happens to be a [NAME] that engages in trade between the [NAME], but its status as such has no necessary connection with the impugned provisions and any competitive disadvantage to out-of-state trade. 274 The circumstances under consideration in these appeals are very different from those in [NAME], [NAME] and [NAME]. In [NAME], the challenged provisions infringed s 92 because of their operation on [NAME] trade in tobacco as such. In [NAME] and [NAME] the extrinsic circumstances showed an intention on the part of the legislature specifically to target an [NAME]. There was no evidence of any such circumstance in these appeals. On the contrary, in this case, there was no evidence or reason to suppose that the impugned provisions were aimed at [NAME]'s trade between [NAME] and the [NAME]. The mere fact that that trade was burdened was not enough to establish discrimination per se: see [NAME] at 475, citing [NAME] v [NAME] (1978) 437 US 117 at 126. 275 [NAME] justifies various arguments as to discrimination by reference to the existence of a national [NAME] market. The existence of such a national market does not, however, alter the inquiry when an infringement of s 92 or, here, s 49 of the Self-Government Act, is alleged. Further, the existence of such a market does not mean that s 92 operates to confer individual rights on all [NAME] in that market, or that a mere comparison of two [NAME] in that market can establish infringement of these provisions. [NAME] submitted that, if the impugned provisions were not held to contravene s 49, then "[NAME] will continue to enjoy a [NAME] competitive advantage … denied to [NAME]". Even if accepted, this would not, for the reasons stated, demonstrate infringement of s 49. 276 Furthermore, [NAME] is not correctly treated as a proxy for [NAME]. First, like [NAME], [NAME]'s business interests extend beyond [NAME]. [NAME]'s wholly-owned subsidiary, [COMPANY], is the exclusive [NAME] [NAME] in [NAME]. [NAME] is also ultimately responsible for the operation of [NAME] in the [NAME]. Second, and perhaps more importantly, [NAME]'s position as the sole [NAME] [NAME] is different to the position of other in-State [NAME] service providers. [NAME] is the only [NAME] service provider to be granted a [NAME] for a defined period to engage in off-course and [NAME] [NAME]. Under the [NAME] regulatory scheme, the difference between [NAME] as the sole [NAME] [NAME] [NAME] and every other [NAME] service provider, whether engaged in intrastate or [NAME] trade, or in trade between the [NAME], is the same in so far as none has the entitlements conferred on [NAME] by the [NAME]. [NAME], the other [NAME] in the in-State [NAME] market are [NAME] who are subject to the impugned provisions in the same way as [NAME]. [NAME] cannot stand as a proxy for them or for the intrastate market. 277 In addition, comparing the business activities of [NAME] and [NAME] distracts attention from the fact that an [NAME] ([NAME]) is disadvantaged by a law of general application to all [NAME] in the same position as it (i.e., all [NAME] who do not hold the sole [NAME] [NAME]) and does not take into account the fact that [NAME] is, by virtue of the [NAME] regulatory scheme, in a different position to all such [NAME] by virtue of the sole [NAME] [NAME] and its concomitant obligations under the scheme considered in its entirety. As [NAME] at 233 [45] acknowledged, the proper enquiry should be directed to whether the [NAME] ([NAME]) as a participant in the trade between the State and the [NAME] is subject to a differential burden by reason of the operation of the impugned provisions in the common circumstances of the trade. This enquiry fails, however, to show discrimination against such trade. 278 [NAME]'s case focused on the differences between the conduct in which [NAME] was permitted to engage and that which [NAME] was prohibited from undertaking. For the most part, this focus was explicit, as for example in relation to the complaint that [NAME] was permitted to engage "in remote terminal self-service betting" via [NAME], but [NAME] was not because its use of a [NAME] was prohibited. On occasions, however, the focus was implicit, as for example in [NAME]'s submission that "the evidence demonstrated that remote terminals were a vital increasing source of revenue for [NAME]". Since no evidence was led in this regard other than with respect to [NAME], [NAME] must be understood as focusing on [NAME]'s position with respect to [NAME]. The differential treatment flowed from [NAME]'s status as the [NAME] [NAME]. Assuming the status of [NAME]-[NAME] was a [NAME] difference, the differential treatment did not establish discrimination per se or against trade between the [NAME].

A statutory [NAME] is not per se discrimination against out-of-state trade 279 The practical operation of the impugned provisions is to confer off-course [NAME] exclusivity in [NAME] on [NAME] as the sole [NAME]. The [NAME] judge held that the impugned provisions burdened trade and commerce between the [NAME] "because in their legal and practical operation they establish [NAME] as a [NAME] provider of off-course betting [COMPANY] in [NAME] in what is a national market for the supply and acquisition of off-course betting [COMPANY]": see [NAME] at 427 [7]; also 447 [101], 448-449 [103], [105], [109]-[110] and 451 [123]. 280 A statutory [NAME] does not, as [NAME] shows, necessarily involve a contravention of s 92 or s 49 of the Self-Government Act. As explained earlier, the High Court ruled that the legislative scheme at issue in [NAME] was valid without there being any need to determine whether it was justified by reference to a non-protectionist purpose. Where a statutory [NAME] exists of the kind considered there, the [NAME] discrimination is between the [NAME] [NAME] and all other [NAME], whether in or out of State. There is no discrimination against out-of-State trade and commerce because no [NAME], in State or out of State, is able relevantly to compete with the [NAME] [NAME]. 281 A licensing scheme such as the one in issue in these appeals that prohibits all [NAME] but one licensed [NAME] ([NAME]) from offering a service within the State establishes a statutory [NAME] for the term of the [NAME]. In terms, such a licensing scheme discriminates only between the [NAME] [NAME] ([NAME]) and those who do not have the [NAME], irrespective of whether their trade is intrastate or out of State. The scheme does not per se discriminate against out-of-State trade in the absence of adequate justification. 282 Even apart from [NAME] and [NAME]'s status as a [NAME] [NAME], the conferral of off-course [NAME] exclusivity on [NAME] does not involve differentiating between [NAME] and trade between the [NAME]. The intrastate or out-of-State nature of the trade is immaterial to the operation of the impugned provisions. 283 As the [NAME] observed in [NAME] v [NAME] at 411-412 [20]-[22], it is necessary to consider the practical operation of the impugned provisions as a whole. Thus, the impugned provisions and [NAME]'s exemption from the offences that they create must be considered in the context of the entire regulatory scheme, which includes the obligations that [NAME] bears under the scheme. To obtain the [NAME] allowing it to carry on [NAME] [NAME] and approved betting competitions and granting it the exclusive right to conduct off-course [NAME], [NAME] made a substantial payment and was required to enter into the JVA pursuant to which it assumed the obligations already mentioned, including the making of substantial payments to fund [NAME], and the facilitation of in-depth scrutiny and a level of control over its activities by [NAME]. [NAME] is, as already noted, subject to a special and distinct regulatory regime both under the JVA and under the State's laws by reason of its status as the [NAME] of the sole [NAME] [NAME]: see [165] above. 284 The fact that [NAME] and [NAME] do not enjoy the same rights and privileges in [NAME] with respect to their bookmaking businesses does not of itself mean that their differential treatment amounts to discrimination. Rather, this differential treatment recognises that [NAME] and [NAME] are relevantly different. [NAME] fails to establish discrimination. [NAME]'s [NAME] exclusivity derives from the arrangements made in 1994, pursuant to which [NAME] acquired, for a substantial price, the business of the [NAME] and the sole [NAME] [NAME]. As part of these arrangements, [NAME] was given a 25% interest in the profits of its business. As indicated earlier, the arrangements and obligations to which [NAME] is subject were assumed by [NAME] in the negotiations that led to it acquiring the [NAME]'s business and the sole [NAME] [NAME], as evidenced in the MOU. In substance, [NAME]'s favoured position in relation to [NAME] and all other [NAME] was the quid pro quo for payments it made and the obligations it assumed when it entered the JVA, acquired the [NAME]'s business and became the sole [NAME]: see [NAME], s 11(2)(e). 285 In these appeals, [NAME] does not challenge the provisions pursuant to which [NAME] was granted the sole [NAME] [NAME]. Nor does it contend that the grant of the [NAME] was in itself contrary to s 92 or s 49 of the Self-Government Act. Rather, [NAME]'s complaint is that it cannot do that which [NAME] may do pursuant to that [NAME]. In substance, [NAME] argues for preferential treatment because it is engaged in [NAME]. Neither s 92 nor s 49 of the Self-Government Act can support its position in this regard. 286 Since the impugned provisions do not in their terms or practical operation discriminate against trade or commerce between the [NAME], they cannot infringe s 49 of the Self-Government Act. For this reason, the appeals must be allowed.

Protectionism – disadvantaging out-of-state trade or advantaging [NAME]? 287 If an impugned measure is discriminatory against out-of-state trade, the critical issue for the purposes of s 92, and s 49 of the Self-Government Act, becomes whether that discrimination is properly characterised as protectionist: see [NAME] at 394, 408 and [NAME] at 471, discussed at [211]-[215] and [218]-[220] above. As already noted, the [NAME] judge concluded that there was discrimination of a protectionist kind because the impugned provisions "entrench [NAME]'s position as the sole supplier in [NAME] of betting facilities of a kind which [NAME] seeks to supply in [NAME] and the market in which both [NAME] and [NAME] operate is a national market": see [NAME] at 451 [123], [125]. 288 Since the impugned provisions are not, in our view, discriminatory against out-of-state trade and commerce, no question about protectionism arises. The impugned provisions cannot be characterised as discriminatory in a protectionist sense because they treat intrastate and out-of-State trade in the same way. For this reason too, they cannot be said to burden out-of-State trade to its competitive disadvantage or to the competitive advantage of [NAME]. 289 In case the impugned provisions are discriminatory against trade between the [NAME], as the [NAME] judge held, the following paragraphs seek to explain briefly why the impugned provisions are not properly characterised as protectionist even in that event. 290 As already noted, the circumstances in the current appeals are relevantly different from the circumstances in [NAME] and [NAME]. In those two cases, as noted above at [218]-[222] and [225]-[232], the legislative history and the practical operation of the challenged measures at the time of their enactment showed an objective intention on the part of the legislature to target a significant [NAME]: see [NAME] at 464, 475-477 and [NAME] at 470-472 [68]-[77], 478 [106], 480 [114], 481-482 [122]. In contrast to these cases, the statutory history of the impugned provisions gives no reason to suppose that, at the time of enactment, the legislature intended to disadvantage out-of-state trade or advantage [NAME]. Further, as discussed hereafter, the character of the impugned provisions, judged by reference to the liabilities, rights and privileges they create, does not justify the imputation of such an intention: compare [NAME] v Commonwealth (2000) 202 CLR 479 at 492 [16] and Kartinyeri v Commonwealth (1998) 195 CLR 337 at 352-353, 372. Nor does the practical operation of the impugned provisions demonstrate discrimination of a protectionist kind – whether considered in terms of their objective legislative intention at the time of enactment, or in terms of their effect at the time the [NAME] seized [NAME] at [COMPANY] (see below at [296] and following). 291 As already noted, the impugned provisions have their origins in late 19th and early 20th century [NAME] laws, when gambling was permitted only on race courses. There is no suggestion that, as blanket prohibitions, they disclosed a protectionist purpose. Rather, [NAME] would have the court impute a protectionist character to them because their prohibitions apply to all [NAME] conducting business in [NAME] save for [NAME]. 292 As the [NAME] judgment stated in Bayside City Council v [COMPANY] (2004) 216 CLR 595 at 629-630, "where a certain kind of differential treatment is put forward as the basis of a claim of discrimination, it may require an examination of the relevance, appropriateness, or permissibility of some distinction by reference to which such treatment occurs, or by reference to which it is sought to be explained or justified". Whether or not, as a practical matter, the differential treatment inherent in exempting [NAME] from the impugned provisions is of a protectionist nature depends on a consideration of matters of this kind. 293 The [NAME] statutory history does not support any imputation of protectionism. As already noted, [NAME]'s favoured position has its origins in the establishment of the [NAME] by the [NAME] ([NAME]) Act 1960 ([NAME]), enacted as a consequence of Justice Martin's report in 1959: see [147] above. History discloses that the statutory [NAME] enjoyed by the [NAME] was introduced to allow off-course [NAME] [NAME] with a single [NAME] in a regulated environment. More immediately, however, [NAME]'s favoured position derives from the arrangements made in 1994, pursuant to which [NAME] acquired the business of the [NAME]. These arrangements were designed to secure funding for [NAME] and also to provide for the well-being of the [NAME]: see [148]-[154] above. These arrangements included the enactment of the [NAME] and the grant to [NAME] of the sole [NAME] [NAME] for an eighteen-year term, as a result of which [NAME] enjoys [NAME] and [NAME] exclusivity. The arrangements also included the JVA and other agreements pursuant to which [NAME] undertook significant obligations to [NAME], including a funding obligation to contribute at a higher effective rate than any other [NAME] and to operate a [NAME]. When enacted in 2003, the GRA represented no material departure in the legislative scheme or purpose from the [NAME]. As noted above (at [155]), the main purpose of the GRA was that of re-enactment and consolidation of the existing regulatory regime: see GRA, s 1.1(1). 294 As we have seen, the grant of the sole [NAME] [NAME] under the [NAME] operated to exempt [NAME] from the prohibitions in the impugned provisions and conferred a [NAME] on [NAME] with respect to off-course [NAME] [NAME]. The GRA operated to preserve [NAME]'s exemption and its [NAME] rights. As explained earlier (at [282]-[284]), the existence of a [NAME] of the kind enjoyed by [NAME] does not demonstrate discrimination of a protectionist kind: it does not operate in terms or practical effect competitively to disadvantage out-of-state trade or advantage [NAME]: compare [NAME] at 467, 468; [NAME] at 203; and [NAME] at 481 [118]. 295 At the time of the enactment of the GRA, the regulatory scheme of which [NAME]'s [NAME] formed part had been in operation for almost a decade. In 1994, besides making the substantial payment and assuming the obligations to which reference has been made, [NAME] was also made subject to a distinct regulatory regime: see [165] and [283] above. The GRA continued this regulatory regime and preserved [NAME]'s rights as the sole [NAME] [NAME] whilst, at the same time, [NAME]'s obligations under the 1994 arrangements continued. Competition from out-of-state [NAME] was insignificant in the early 1990s and, by 2003 when the GRA was enacted, it was still no more that "a niche segment" in the [NAME] market: see [200] above. In this context, there is little reason to suppose that when the [NAME] and the GRA were enacted, they created or preserved a [NAME] that operated to advantage [NAME] or disadvantage out-of-state trade in a protectionist sense. 296 [NAME] argued that the fact that, at the time of enactment, the practical operation of the impugned provisions was not to advantage [NAME] or disadvantage out-of-state trade was conclusive of the absence of protectionism. They submitted that: (1) the practical effect of a law on out-of-state trade was [NAME] only to identify the character of a law; (2) the process of characterisation was an inquiry into the objective intention of the legislature in enacting the impugned provisions; and (3) the [NAME] time for an inquiry as to the practical effect was at the time of enactment of these provisions. [NAME] argued that the practical operation of the impugned provisions on facts that were not in Parliament's contemplation at the time of enactment was not [NAME] to the question of validity. [NAME] argued that the [NAME] judge wrongly rejected this submission and that [NAME] failed to consider the correct question – whether the practical operation of the impugned provisions founded an inference that the true purpose of the provisions was to achieve a protectionist object. 297 Against these propositions, [NAME] argued that, in s 92 jurisprudence, where validity depended on the practical operation of a law, the practical effect of an impugned measure was to be considered as at the time of the alleged invalidity – in this case, on 16 July 2010, when the [NAME] seized [NAME] and thereby interfered with [NAME]'s trade. In written submissions, [NAME] said: It is clear that since July 2004 the [NAME] market has changed considerably with the development of internet [NAME], the growth of corporate [NAME] and the introduction of race fields. Section 92 must be applied in a way that accommodates these changes. The core questions posed by s 92, namely whether a discriminatory burden of a protectionist kind is imposed and, if so, whether the burden is saved by a non-protectionist purpose are to be answered as a practical matter at the time the burden bites. 298 The issue of time raised by the parties' submissions is an important one that has attracted scholarly attention: see, for example, [NAME], "Intention or Effect? Commonwealth and State Legislation after [NAME]" (1995) 69 ALJ 332 at 337-341; [NAME], "Grounding the High Court's Modern Section 92 Jurisprudence: the Case for Improper Purpose as the Touchstone" (2005) 33 FL Rev 445 at 465-484; and [NAME], "Section 92, Factual Discrimination and the High Court" (1991) 20 FL Rev 240 at 245-248. As explained below, it is, however, unnecessary to determine the issue here, because the changes relied on by [NAME] do not affect the resolution of these appeals. 299 Whilst the evidence showed that, by 2010, [NAME] faced competition from a range of [NAME], including out-of-state corporate [NAME] like [NAME], there was no reason to suppose that [NAME]'s favoured position was on this account converted from a permissible to an impermissible [NAME]. The change could not retrospectively alter the objective intention of the legislature in enacting the GRA, or the [NAME]. This was, and remained, a non-protectionist purpose. Equally importantly, the different treatment accorded [NAME] as compared with other [NAME], including [NAME] such as [NAME], continued to be explicable by reference to a [NAME] difference between [NAME] and other [NAME]. That is, [NAME]'s favoured position continued to be explicable by reference to the arrangements made in 1994, pursuant to which [NAME] acquired the sole [NAME] [NAME] and assumed the significant obligations to which reference has been made. [NAME] [NAME] argued that it was competitively disadvantaged in comparison with [NAME] by reason of the fact that the impugned provisions prevented it from using a [NAME] in [NAME] although [NAME] could use [NAME]. [NAME] contended that "[t]he competitive disadvantage that flows to [out-of-state] [NAME] was clearly proved by the commercial exploitation of the [NAME] by [NAME]". There are a number of difficulties with this submission, some of which have already been noted. [NAME] [NAME]'s argument with respect to changed circumstances tended to assume, at another level still, an individual rights theory of s 92. The fact that the impugned provisions prevented [NAME] from competing with [NAME] in one way (by using a [NAME]) does not demonstrate protectionism. To establish discrimination of a protectionist kind, [NAME] had to show, in effect, that, by exempting [NAME] from their operation, the impugned provisions subjected [NAME], as a proxy for trade between the [NAME], to a competitive disadvantage sufficient to warrant a finding that the provisions were protectionist: see [NAME] at 399, 409 and [NAME] at 426. [NAME] did not satisfy this requirement. Having regard to the whole of the legislative scheme, there was no evidence that, as a matter of fact, the impugned provisions created such a competitive disadvantage for [NAME] as an out-of-state [NAME] that warranted the provisions being characterized as protectionist. There was, for example, no evidence that [NAME]'s market share or profits were reduced as a consequence of the impugned provisions: compare [NAME] at 235-236 [55]-[56], 237 [62]-[63], 249 [110], 254 [133]. Nor was there evidence that, [NAME] aside, the impugned provisions operated to the competitive advantage of in-State [NAME] as a whole. As [NAME] and [NAME] clearly showed, the fact that the impugned provisions affected competition between [NAME] in a national market, even on different sides of [NAME] borders, was insufficient to establish protectionism: see also [NAME] at 472 and 474. [NAME] In supplementary submissions dated 18 April 2012, [NAME] made what it termed a "formal submission" that s 92 should be construed to "prohibit any … restriction of trade, commerce and intercourse among the [NAME] which is detrimental to competition in a market, which operates without reference to State boundaries". This submission must fail, having regard to the authorities discussed earlier. Furthermore, as [NAME] noted, this was not the case [NAME] ran at [NAME] and has no basis in the pleadings. The submission was not the subject of a notice of contention. Had the submission formed part of [NAME]'s case at [NAME], it seems likely that [NAME] would have led further evidence.

Protectionism – Not reasonably necessary to achieve a legitimate purpose? [NAME] if the impugned provisions discriminated against out-of-state trade to its competitive disadvantage or the advantage of [NAME], the provisions cannot be characterised as protectionist if they were enacted in pursuit of a legitimate objective and were appropriate and adapted, or reasonably necessary, to achieve that objective: see [NAME] at 408-410 and [NAME] at 477 [102]-[103], discussed at [231]-[233] above. [NAME] [NAME] contended that the impugned provisions were reasonably necessary for: (a) funding the [NAME] by means of the payment obligations imposed on [NAME] as the [NAME] of the sole [NAME] [NAME] conferring off-course [NAME] and [NAME] exclusivity ([NAME]'s contention); (b) for the regulation, control and restriction of off-course betting in [NAME] ([NAME]'s contention); (c) for the promotion of a vibrant and [NAME] [NAME] program and associated spectacle, including by materially funding [NAME] ([NAME]'s contention); (d) for the promotion of an attractive and socially beneficial form of [NAME] through the provision and protection of an ubiquitous [NAME] ([NAME]'s contention); and (e) for the preservation of integrity and probity within the [NAME] [NAME] and [NAME] industries ([NAME]'s contention). [NAME] enough, these objectives overlap and are inter-related: compare [NAME] v [NAME] at 490 [138]. Further, when considered in light of the circumstances mentioned earlier, objectives (a) and (c) may be regarded as different formulations of essentially the same idea. Both involve the proposition that the impugned provisions are reasonably necessary for the promotion of a [NAME] [NAME], including for the purpose of funding the [NAME]. Likewise, objective (b) and objective (e) can be understood as different ways of expressing essentially the same objective. Objective (d) may be considered as part of both sets of objectives. [NAME] The [NAME] judge rejected the contention with regard to funding because [NAME] failed to demonstrate that the impugned provisions were "the only means or a necessary means" to achieve that end (emphasis in original): see [NAME] at 455 [141], 455-456 [143], 456 [145], 457 [149], 458 [150]-[151]. In [NAME]'s words (at 455 [141]), "the evidence did not establish what was the necessary level of funding, and whether that level of funding could only be secured by maintenance of the impugned provisions". Similarly, [NAME] held that [NAME] had not shown that the impugned provisions were reasonably necessary for the regulation, control and restriction of off-course betting in [NAME] because it was not shown that "the objectives sought to be achieved could not be achieved without the impugned provisions": see [NAME] at 459 [154].

Reasonably necessary for the promotion of a [NAME] [NAME], including for the purpose of funding the [NAME] 307 The legislative history shows that, objectively speaking, these objects were amongst the chief purposes of the legislative regime, of which the impugned provisions formed part: compare [COMPANY] v [COMPANY]) (2005) 224 CLR 322 at 394 [178] ([NAME[NAME]) and 462 [423]-[424] ([NAME[NAME]). Under the legislative scheme, [NAME]'s exclusion as the sole [NAME] [NAME] from the prohibitions in the impugned provisions conferred off-course [NAME] and [NAME] exclusivity. The legislative history and the liabilities, rights and privileges that the impugned provisions create show that [NAME] was granted [NAME] exclusivity upon the basis that [NAME] would provide a [NAME] [NAME] service and from that service provide much of the funds for the [NAME]: see [145]-[171] above; also [NAME] [NAME] at 453-454 [135]. 308 It was, of course, open to the State to be of the view that the [NAME] contributed to the social, cultural and economic well-being of [NAME] and to decide upon a funding model for the [NAME]: see [142]-[144] above. This model (see [172]-[185]) has worked well. As noted, the [NAME] judge stated that the funding model used in [NAME] "has been and remains highly [NAME]" and is also used in other Australian jurisdictions and internationally: see [NAME] at 454 [136]. 309 [NAME] argued that [NAME]' case on funding was fatally flawed in two respects. First, [NAME] made no attempt to quantify the level of funding that was necessary to fund [NAME] and, secondly, [NAME] returns were not in decline, notwithstanding the increased competition from the growth of corporate [NAME]. It was, however, unnecessary for [NAME] to meet these propositions. The question was whether [NAME] established that the legislative scheme was reasonably necessary for a legitimate objective – such as the promotion of a [NAME] [NAME], including for the purpose of funding the [NAME]. Having regard to the following considerations, [NAME] made out their case. 310 [NAME] challenged the width of the prohibitions in the impugned provisions but, plainly enough, a prohibition of this kind was a concomitant of the [NAME] that was part of the State's legislative scheme. Further, funding via this [NAME] model is integral to the success of the [NAME]. In the words of the [NAME] judge, [NAME]'s contributions are "an essential part" of keeping the [NAME] "vibrant and [NAME]" and the [NAME]'s position "could not be maintained without substantial funding of the kind it presently receives", which necessarily included contributions from the gambling [NAME]: see [NAME] 454 [136], 457 [148]-[149]. 311 As the earlier discussion discloses, most of the [NAME]'s revenue derives from distributions by [NAME] to the [NAME]'s controlling bodies under the JVA; revenue from other sources is significantly less: see [NAME] at 453 [135]. Distributions from [NAME] are largely derived from [NAME] [NAME]. [NAME] [NAME] has proved a reliable means of generating funds for [NAME] and has provided greater funding certainty for the [NAME] than other forms of [NAME]. For this and the other reasons already mentioned, a [NAME] [NAME] is reasonably seen to be important for the continued success of the [NAME]. [NAME]'s [NAME] exclusivity is vital for maintaining a [NAME] [NAME] and [NAME]'s funding level for the [NAME]. 312 It should be borne in mind that there was no evidence that any increase in [NAME] overall would offset the loss in funding from [NAME] in the event that [NAME] lost its [NAME] exclusivity. There was also no evidence that there was an alternative viable funding model that would confer the same or more benefits than the current model. 313 In these circumstances, there was no need to establish a precise level of funding, as [NAME] argued. The evidence was that the size and success of [NAME] varied with the level of funding it received. It was enough to show, as [NAME] did, that without substantial funding of the kind the [NAME] currently receives from [NAME], the [NAME] could not sustain its current position; that the current funding model has sustained the success of the [NAME]; that if [NAME] were to lose its [NAME] exclusivity, the level of funding for the [NAME] would be lower and less secure; and that this would entail a less [NAME] [NAME] program and associated spectacle. In the circumstances, the impugned provisions can properly be regarded as reasonably necessary or appropriate and adapted for the promotion of a [NAME] [NAME], including for the purpose of funding the [NAME]. 314 At this point, it is necessary to consider two matters raised by the [NAME] judge. The first was that [NAME] held that, at this stage of the analysis required by [NAME] v [NAME] and [NAME], funding was not a legitimate objective. [NAME] held, mistakenly, that this followed from the observations in the [NAME] judgment in [NAME] at 479 [108]: see [NAME] at 456-457 [145]-[146]. 315 In [NAME] at 478 [106], the [NAME] judgment drew attention to a statement made by the [NAME] State Minister in the State [NAME] to the effect that [NAME] opposed betting exchanges because the exchanges made no contribution to [NAME] in Australia and "allow[ed] [NAME] to bet on any of the [NAME] codes and lose". The [NAME] went on to say (at 478-479 [107]-[108]): First, as to the absence of contribution to [NAME] in Australia, so far as that may be [NAME]. The evidence shows that by agreement with the [NAME] regulator, [NAME] undertook to return an amount equivalent to 1 per cent of the value of bets taken by it on races in [NAME]; this is the same level of return as that required from [NAME] in that State. [NAME] has been meeting that obligation. There is no reason to doubt the assertion by [NAME] that it remains ready to undertake obligations of this kind in [NAME] and to ensure that the organisers of races in that State obtain a reward from [NAME] as well as from other [NAME] in that State. In its submissions [NAME] also contended that any practical effect of the impugned legislation in protecting the turnover of in-State [NAME] from diminution as a result of competition from [NAME], with consequent prejudice to the returns to [NAME] and in-State revenue provided by it, could not be protectionist in nature. But a proposition which asserts that an object of revenue protection of this kind may justify a law which discriminates against trade is contrary to authority [[NAME] at 426-427; [COMPANY] v [NAME] (2003) 133 FCR 63 at 80]. And it is contrary to principle, for such a justification, if allowable, would support the re-introduction of customs duties at State borders. 316 In the first of these paragraphs, the [NAME] acknowledged the permissibility of requiring contributions in order to fund a State's [NAME]. The [NAME] clearly contemplated that a requirement to make such contributions is permissible at least if it is imposed at the same level on local and [NAME] [NAME]: see also [NAME] 488 [146] ([NAME[NAME]). Read with this in mind, it is apparent that the second paragraph is concerned with a further and different object – the protection of the revenue of the State (qua State) provided by the returns to the State's [NAME]. The reference to "revenue" in this paragraph is to State revenue from taxation and other imposts, which would be prejudiced if the returns to [NAME] were prejudiced. 317 In the second paragraph, on which the [NAME] judge relied, the [NAME] stated in effect that, for the purpose of s 92 and s 49 of the Self-Government Act, the protection of State revenue was not a legitimate objective. The report of argument in [NAME] at 433 and the [NAME]'s reference to [NAME] at 426-427 and [COMPANY] v [NAME] (2003) 133 FCR 63 ("[NAME]") at 80 confirms that this was in fact their Honours' intended meaning. 318 In particular, in [NAME] at 80 [43], a [ADDRESS] of this Court specifically said: The appellant submitted before us that the only objective now remaining is raising taxation revenue for the [NAME]. This would not be a legitimate objective for the purpose of justifying a discriminatory burden: see [NAME] v [COMPANY]. (Emphasis added.) Elsewhere in [NAME], the [ADDRESS] specifically referred to the possibility that the protection of [NAME] by appropriate funding measures could be a legitimate objective: see [NAME] at 79-80 [41]. There is no reason to suppose that the [NAME] in [NAME] overlooked the distinction discussed in [NAME] between protecting a State's [NAME] through appropriate funding arrangements and protecting the State's revenue. 319 Considered in this way, [NAME] did not require the [NAME] judge to conclude that legislative measures designed to promote a [NAME] [NAME] by maintaining funding for the [NAME] were directed to an illegitimate objective. As the [ADDRESS] observed in [NAME] at 79 [41], [NAME] v [NAME] held that the protection of Tasmanian crayfish stocks was a legitimate objective in circumstances where the exploitation of stocks was non-discriminatory. Given this, there is no reason to suppose that the promotion of a State's [NAME] is not also a legitimate objective provided it is non-discriminatory. Further, there no reason in principle why such an objective should cease to be legitimate simply because the measures in question are directed amongst other things to funding the [NAME], as opposed to maintaining the quality of crayfish stock, as in [NAME]. 320 The second difficulty with the [NAME] judge's analysis was that [NAME] stated that, to meet their burden at this stage of the inquiry, [NAME] were obliged to establish the "necessary" or "adequate" level of funding for the [NAME] in a given form, or that this level of funding could only be secured by the impugned provisions: see [NAME] at 455 [141], 457-458 [149]-[150]. As already indicated, in our view, [NAME] were not required to establish this. The inquiry is one of reasonable necessity, or whether the impugned provisions are appropriate and adapted to a legitimate objective – here, the promotion of [NAME], including for the purpose of funding the [NAME]. In this context, necessary does not mean "essential" or "indispensable": see [229]-[233] above, citing [NAME] v [NAME] at 199 [39] and Hogan v [NAME] at 418 [72]. There was ample evidence that the impugned provisions were reasonably necessary, or appropriate and adapted, for the promotion of a [NAME] [NAME], including for the purpose of funding the [NAME] and, indeed, that they had achieved this objective. 321 Having regard to this conclusion, there is no need to consider further whether the impugned provisions were reasonably necessary or appropriate and adapted to the other objectives on which [NAME] relied.

DISPOSITION 322 For the reasons stated, the appeals must be allowed. The impugned provisions do not infringe s 49 of the Self-Government Act and there is no inconsistency to which s 109 of the Constitution applies. The impugned provisions do not in their terms or practical operation discriminate against trade or commerce between the [NAME]. If it were necessary to examine the matter further, the impugned provisions would not properly be characterised having a protectionist operation. 323 Before the judgment in these appeals was delivered, [NAME] delivered judgment in [COMPANY] v [NAME] (No 6) [2012] FCA 896; and with the leave of the Court, [NAME] and [NAME] filed short submissions addressing the decision. The State did not wish to add to [NAME]'s submissions. Having considered the matter, there is nothing that would lead us to depart from what we have stated above. 324 Having regard to the fact that the appeals concern only part of the judgment of the [NAME] judge, we would direct that, within seven days, the appellant in each [NAME] file short minutes giving effect to these reasons for judgment. 325 We would also direct that, if the parties in each [NAME] are unable to agree within seven days on the appropriate costs orders for the proceeding before the [NAME] judge and for the [NAME], within a further seven days, the appellant in each [NAME] file and serve its written submissions as to the appropriate costs orders and, within seven days thereafter, the respondents file their written submissions. In either case the submissions should not exceed three pages. I certify that the preceding two hundred and fourteen (214) numbered paragraphs are a true copy of the Reasons for Judgment herein of the [NAME] and [NAME].

Associate: Dated: 12 October 2012