In an effort to battle the threat of so-called 3U gambling, The Hong Kong Jockey Club and the Japan Racing Association announced Wednesday a landmark mutual "Good Neighbor Policy" on wagering.

Both the HKJC and the JRA agreed in the policy to respect each other' jurisdictional integrity with regards to wagering. 3U gambling refers to "unauthorized, uncontrolled and unlimited" gambling, a worldwide concern, especially in countries such as Japan, where racing and related gambling is strictly regulated by the government.

According to the JRA, recent years have seen Japan increasingly targeted from operations in Canada, Australia from Vanuatu and Hong Kong from the United Kingdom and Australia's Northern Territory.

An incalcuable, though significant, amount of revenue is lost to such operators every year. Illegal operators seek to attract wagerers through the Internet, by offering more attractive odds than the parimutuel odds offered on races being held in the targeted countries.

The operators feed off the respective racing industries, pay no tax and return nothing to the industries, which rely on betting revenue to function.

JRA President Masayuki Takahashi said in a statement, "Promoting the 'Good Neighbor Policy' will enable each country to secure its financial basis in the industry and eventually bring sound development worldwide."

Hong Kong and Japan racing authorities will officially execute the signing of the policy at the Hong Kong international races this December.