THE third annual Hong Kong-Shenzhen cross-border marathon looks certain to be cancelled following a demand for a $500,000 ''administrative'' fee by the Shenzhen Amateur Athletic Association. The SAAA have almost doubled their fee for helping stage the event after collecting $280,000 for the last race. The demand has left organisers the Hong Kong Amateur Athletics Association - who incurred massive losses in staging the first two marathons - ready to scrap the prestige event. HKAAA chairman William Ko admitted last night that the February 20 race was in serious jeopardy, adding: ''We can't afford it.'' He said he had expected an increase in the fee - covering the huge amount of manpower needed to ensure the smooth running of the race on the other side of the border - but that the latest figure was simply too much. Ko said the HKAAA would consider the demand from Shenzhen and that a final decision on whether to proceed with the event would be taken next week. The massive fee increase from across the border is a huge blow to the HKAAA, who are understood to have been left $250,000 in arrears after the second race was staged earlier this year. The inaugural race in 1992 lost more than $211,000, putting the association $288,000 into the red. The very nature of the cross-border event means the HKAAA are totally at the mercy of the SAAA once the athletes have entered Chinese jurisdiction. The Shenzhen authorities are responsible for organising security, transportation, traffic control, police and other relevant areas needed to run the race properly. The cross-border marathon, one of the few held in the world, was established in place of the Hong Kong International Marathon after traffic build-up along the Tolo Harbour Highway increased dramatically, forcing organisers to look for an alternative venue. Ko said the HKAAA were still committed to organising the marathon but admitted there was a big task ahead. ''We will be trying to work towards cutting the costs. I haven't been able to get in touch with the Shenzhen authorities lately and we would have to talk about that,'' he said. ''In the meantime, we will be trying to secure sponsorship and there are indications that a couple of sponsors are interested but to what extent we don't know yet.'' The first race in 1992 was supported by Reebok, Watson's Water and the Kowloon Canton Railway Corporation. The KCRC pulled out of this year's race, but Reebok and Watson's remained involved and the event was also supported by the Sports Development Board. The race reputedly cost organisers more than $2 million to stage. Reebok officials were unavailable for comment last night but Watson's said they remained committed to the race and that they would continue to sponsor the event if the association decided to proceed with it. SDB public relations officer Sandra Lee said they had not received a formal request for sponsorship, although they expected the amount would be less than the $150,000 requested by the association for the second race earlier this year. ''The association said that they required less funds than the last time because they were working with other sponsors. ''The funds the SDB will be spending will be on eligible fees although we haven't had a formal request from them yet,'' she said. The HKAAA were unable to cut down on costs for this year's race despite it being held in the second week of the Chinese New Year when more people in Shenzhen were willing to work. New Zealander Peter Handcock beat a 500-strong field to win the race which started at Fanling Sports Ground and finished outside the Shenzhen Municipal Stadium.