How Ontario is Leading the Way for Canada’s Online Gambling Industry
Since the advent of online sports betting and casino gambling around the turn of the century, the laws that govern Canadians have never been clear. The presumption has always been that Canadians are free to use offshore gambling sites as long as they don’t use wire transfers and debit/credit cards to fund their gambling accounts.
The presumption aside, it’s still unclear if Canadians may legally gamble through foreign interests. Things became more confusing when certain provinces passed laws allowing online gambling operators to operate on Canadian soil as long as they denied services to Canadians. In other words, Canadian-based operators became offshore gambling sites restricted from targeting foreign gamblers.
It is worth noting that several provinces (Manitoba, New Brunswick, & Newfoundland) do allow online gambling access to government-controller operators like PlayNow & Proline Plus, but such activities are very limited to sports betting.
How Ontario is Blazing a New Trail
As the province with the largest population, Ontario has always been at the forefront of setting the standards by which all Canadians live. It makes perfect sense that lawmakers in Ontario would be the first ones to tackle the online gambling question in earnest.
The desire to gamble among Canadians has never been in question. After all, Canada is home to dozens of land-based retail casinos, Off-Track-betting facilities, poker rooms, and horse racing venues. The desire to take their gambling activities online would seem to have been a natural progression in line with what has been taking place south of the border in the U.S. since May 2018. The growing number of Ontario online casinos proves this.
The key date was June 22, 2021, when Bill C-218 was passed by Ontario lawmakers. Two months later, the bill officially went into effect, effectively creating the framework by which offshore gambling operators could offer legal gambling services to Canadian citizens. This was also the time when the OLG Proline platform was launched to serve as Canada’s only legal single-game sports betting platform.
Moving forward, April 2, 2022, was the date that offshore-based iGaming operators licensed in Canada could officially start offering their services throughout the world, including to wanting Canadians.
The positive effects of Bill C-218 are now well documented. The key benefit has come from the collection of nearly half a billion dollars in tax revenue charged to licensed operators to date. This influx in revenue has helped the Ontario government balance the province’s budget.
Key provisions of Bill C-218
- The online gambling age for Canadian gamblers using offshore sites is 19 years of age or older.
- The Alcohol and Gaming Commission of Ontario (AGCO) and its primary subsidiary, iGaming Ontario, regulate the iGaming market.
- Operators must complete the AGCO licensing process to offer services to Canadian online gamblers.
- iGaming operators are additionally required to comply with anti-money laundering laws and support problem gambling initiatives whenever possible.
Ontario Tackles Another Online Gambling Frontier
In high-volume online gambling countries like England and the U.S., online poker and Daily Fantasy Sports (DFS) have become very popular among online gamblers. It’s something that Canadians are not yet permitted to do. Why? Playing online poker and participating in DFS contests requires players to compete among themselves across country boundaries. This is another question to which the law is not very clear. Ontario lawmakers are looking to clear this up once and for all.
Ontario lawmakers are going to court in Toronto later this fall. They are seeking a landmark court ruling on whether province gamblers can compete with individuals outside Canada. A positive ruling would allow Canadians to legally use offshore poker rooms and DFS sites.
As of now, the federal Criminal Code does not adequately address this issue. According to Ontario Attorney General Doug Downey through his press secretary Jack Fazzari, CBS News was told through an email that:
“It’s important that we get this right to provide the most legal certainty to operators and players as this new industry grows in Ontario.”
Currently, Canadians are only permitted to compete with other Canadians via online poker and DFGS sites. At issue is the rather small population of players, which isn’t appealing to real poker and DFS enthusiasts. They have been hungering to compete in larger player pools with larger prize pools, leading them to resort to illegal forms of online gambling. The craving for a wider range of poker options is also apparent.
While it’s true there have been no meaningful prosecutions, the issue still exists and demands attention.
Public sentiment remains divided
Proponents in favor of a positive ruling from the federal want to bring Canadians back to regulated online gambling markets. It would certainly provide a significant boost to an aspiring Canadian online gambling industry where tax revenue goes into province coffers.
According to Paul Burns, CEO of the Canadian Gaming Association (in a press release):
“You could see, I think, a significant increase in the poker business in the province.”
As one would expect, there is opposition that would like the Toronto court to rule that such activities are illegal. Most of the opposition is coming from smaller provinces that aren’t on board with the idea of expanding iGaming activities in their respective provinces.
Setting this argument aside, it’s clear that Ontario’s approach to iGaming in recent years is moving things in the right direction. The fact is that 86% of the country’s online gamblers are now using regulated sites because they are safer. That’s compared to 70% of those who were sticking with regulated sites pre-iGaming Ontario.
Here’s the bottom line: A favorable ruling by the court would help align this part of Canada with the international online gambling scene. In all likelihood, other provinces would follow suit.
Canada’s growing population of online gambling enthusiasts can expect a court ruling sometime later this year.