Gambling firms seek $1.2b from Vic govt

The Victorian government owes gaming companies Tatts and Tabcorp more than $1.2 billion because of changes to poker machine licences, a court has heard.

The companies say they are entitled to hundreds of millions of dollars from the government after their licences to run the state's poker machines expired in August 2012.

New licences to own and operate the machines were instead issued to individual venues.

Tabcorp barrister Alan Archibald QC told the Victorian Supreme Court on Monday that the 1994 Gaming and Betting Act gave Tabcorp and Tatts the right to a payout if their licences were not renewed.

The company was owed $687 million, plus more than $100 million in interest payments, Mr Archibald told the court.

Tatts is seeking $490 million from the state on similar grounds.

But the government says it does not have to make any payment as the 1994 act is no longer enforceable as it has been replaced by new legislation.

The government also says the gaming machine entitlements issued to venues in 2012 are materially different from the licences formerly held by Tatts and Tabcorp.

The hearing continues.