Current State of Gambling Regulations in Canada

Despite an enormous shift in the way that people gamble and play casino games, legislation on gambling in Canada has remained largely unchanged since 1985 – the last time that the Criminal Code underwent any real overhaul in this respect. In the intervening years the number of Canadians who gamble has risen sharply, driven largely by increased access to online bookmakers and casinos.

Current State of Gambling Regulations in Canada
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Despite these changes, the Canadian authorities have by and large continued to turn a blind eye to the impact of online gambling. In 2021, it seems that change is finally on the way. Here we take a closer look at the state of regulations today, and how we expect them to change in the near future.

Provinces court new players with live casinos

An illustration of the way that provinces have attempted to make their products more relevant is the introduction of live dealer casino games. As these types of game gained popularity, some of the state-sanctioned casino sites added live gaming options to their collections. Espacejeux in Quebec and PlayOLG in Ontario both have fairly extensive live casinos online sections.

However, the inclusion of these games only serves to highlight the core of the issue, which is that the official casino sites simply cannot compete with what private operators can provide. So, what exactly does the law say? Theoretically, the only legal form of online gambling in Canada is through the sites operated by the various provinces. These online casinos, which are run in conjunction with licensed private software providers, are an important source of revenue to the state.

In practice, Canadians are entirely free to gamble online via private offshore casinos and sports betting sites. The Criminal Code prohibits private gambling sites from basing their operations on Canadian soil, but there is nothing that specifically criminalizes the use of overseas providers. Stacked up against the competition, the state-run sites simply cannot provide the range of games and gambling options that customers can find elsewhere.

Quebec’s challenge and the resulting effects

In 2016, the Province of Quebec attempted to pass and implement legislation that would compel internet service providers to block access to private gambling sites. The initial legislation did pass, but it was quickly struck down by the courts as unconstitutional.

Although site blocking is used in many jurisdictions, notably the UK, the move was deemed to go against Canada’s liberal approach to freedom of speech and information.

Paradoxically, Quebec’s challenge and the subsequent failure to implement restrictions may have served to help the cause of offshore gambling sites. The court’s ruling is likely to have encouraged more big-name providers to target the Canadian market, so customers now have more choice than ever. The single biggest advantage of using a provincial online casino site is the guarantee of consumer protection. With more trusted names taking on Canadian players, even this benefit has been devalued.

Quebec have appealed the decision, and the case is expected to go as far as Canada’s Supreme Court. There seems little doubt among legal experts that the initial decision will be upheld, and that the provisions are indeed unlawful. For now, the online market remains completely open to any and all operators – a state of affairs that is hardly conducive to best practice from the industry.

Gambling law on the verge of change

Based on the failure of the Quebec government to tighten regulations, most industry experts agree that this is not the correct approach. At present, it is Ontario that leads the way on gambling reform. Having conducted extensive internal and external consultations, the province has now moved into a phase of public engagement. This stage is to be led by the former head of the Danish gambling regulator, Birgitte Sand.

The hope is that by the end of the year, Ontario will allow private operators to enter the market on official terms. The responsibility of licensing, consumer protection, regulation and anti-money laundering will likely fall to the Alcohol and Gaming Commission of Ontario (AGCO).

Crucially, the move would bring in tax revenue from private gambling sites, which the whole country is currently missing out on. Should the legislation be successful, it is expected that other provinces will pass similar reforms, and that the Code will eventually be updated to reflect the shift.

Sports betting reforms almost here

For a number of years, there have been increasing calls to reform the Code concerning sports betting. This year, it seems that it will finally happen. Current regulations impose a ban on single-event sports bets, allowing only parlay bets instead. This system, which forces sports bettors to choose a combination of at least two wagers, is not very favourable to the customer.

Here again, the government is missing out on a major revenue stream – not to mention spending substantial amounts to advertise a product that is inferior to what customers can find elsewhere. Since the greatly increased access to offshore sportsbooks, single-event sports betting has already become a reality in Canada. As the bill to amend the Code makes its way through various hearings, it is hoped that the law will soon align with that reality.

Interesting related article: “What is a Wager?