Canadian Gaming CEO Says Other Provinces Year Or Two Away From Ontario Online Model

July 26, 2022
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Interested observers continue to wait for the first report card on the performance of Ontario’s online gaming program, and insiders say those observers include policymakers in other provinces.

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Interested observers continue to wait for the first report card on the performance of Ontario’s online gaming program, and insiders say those observers include policymakers in other provinces.

iGaming Ontario has yet to release the first set of market data on the performance of the only liberalized sports betting and online gaming market in Canada since its April launch. To date, about 30 companies have launched regulated offerings in the province.

The high level of interest has prompted a frequent question of when, or if, other provinces in Canada will follow Ontario’s lead in pursuing a competitive market of private operators rather than the lottery corporation monopoly model that exists in the country’s other provinces.

Paul Burns, president and CEO of the Canadian Gaming Association, said other provinces are actively watching the Ontario process unfold.

“I think what we're going to see is a period now of watching market performance,” Burns said. “There is this perception that there are provincial monopolies existing; they actually don't because of the grey market in Canada.

“Lottery corporations across this country have been competing with the grey market for 20 years, since they've launched their sites,” he continued, referring to the government-run online casinos and betting platforms of provincial lottery corporations.

“What drove Ontario was around consumer protection, enhancing the regulatory oversight, bringing responsible gaming measures and other forms of the regulatory compliance to the entire gaming market in the jurisdiction.

“And I think with that philosophy, other jurisdictions are going to start to look.”

Burns added that some jurisdictions have work to do in matching Ontario’s regulatory framework.

“As an association, we've said there's a need to regulate all gaming in the country, leaving iGaming out there in the grey market is not sustainable,” he said. “I think we're a year or two away before we get some more meaningful discussions.

“Some jurisdictions have really not gotten beyond the mindset of, of they think there's there is a monopoly, there isn't anymore,” Burns continued at the SBC Summit North America conference earlier this month in New Jersey. “I mean, consumers across this country are using all kinds of grey market operators.

“It's going to take some time, but I think the market performance in Ontario, how the regulatory regime performs, the consumer protection measures that were put in place are all leading to an example for the rest of the country to hopefully follow.”

Grey market operations not only continue in other Canadian jurisdictions, but also in Ontario during a transition period permitted by regulators whereby existing offshore operators can continue to operate while their application remains pending.

The Alcohol and Gaming Commission of Ontario (AGCO) has repeatedly warned operators that the grace period will not be an indefinite one, however, hinting at a fall 2022 end to the transition that could force operators to go dark if they have not already received a permit by that date.

Even after that point, regulated operators in Ontario can continue to operate unregulated in other Canadian provinces without facing sanctions in Ontario, a policy that Scott Vanderwel, CEO of PointsBet Canada, takes issue with.

“I like to say there are legal and illegal operators at this point in Ontario, someone who's a legal operator today in Ontario can be offering services illegally in Alberta, and I don't think that's a sustainable position over any period of time,” Vanderwel said at the SBC Summit.

“In fact, I think it's a bit hypocritical that that framework exists, unless there is a pathway to driving those grey operations outside of Ontario into either, you know, becoming regulated, or removing their services from those provinces,” he continued.

“And I actually think while it's incumbent on the local governments to help solve that problem, it's also incumbent on those operators to take a look at their operations and ask the question, should they be splitting hairs jurisdictionally, across one country.”

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