The countdown to the launch of Ontario’s competitive online gambling market began in earnest on Friday (January 28) when officials announced a go-live date of April 4, giving operators and regulators around ten weeks to clear a long to-do list.
The launch date was announced by iGaming Ontario (iGO), the newly formed independent subsidiary the of province’s gaming commission that will contract with what is likely to be dozens of operators in the first fully open online gambling market in Canada.
The regulated market will ensure Ontarians are playing with websites that “have met rigorous standards of game and operator integrity, fairness, player protections and social responsibility,” said iGO executive director Martha Otton in a statement.
“Our new internet gaming market will give consumers enhanced entertainment choice, support the growth of a new, legal market and generate revenue that can help fund programs and services that benefit all of us.”
Confirmation of a go-live date brought a sigh of relief among hopeful operators and suppliers for at least two reasons.
First, there had been a degree of concern that market launch might be stalled when leading land-based casino operator Great Canadian Gaming Corporation released a report earlier this month warning cannibalization and significant job losses due to Ontario’s open model that does tie internet gaming to incumbent casinos like in U.S. states.
Provincial elections in June were also being looked upon warily, with the risk of a delay rising as election season draws nearer.
In a statement, Canadian Gaming Association CEO Paul Burns described the upcoming launch as “another milestone” following last year’s historic federal legislation allowing provinces to regulate single-event sports betting.
“The move to establish a regulated iGaming market in this province will ensure that the people of Ontario have access to safe and legal gambling options online while encouraging investment and job creation in Ontario.
“We finally have the opportunity to safeguard the economic benefits that will start to flow to licensed gaming operators and the provincial government,” said Burns, whose association represents private companies active in Canada’s gambling market.
The April date means prospective operators can now finalize marketing plans and make key hiring decisions, although there is still a lot of work to do on the regulatory front.
To be eligible, operators have to register with the Alcohol and Gaming Commission of Ontario (AGCO) and provide an audited matrix of how they will come into compliance with AGCO’s regulatory standards, as adopted last year.
On a second front, operators must also execute a commercial contract with iGO, which will conduct and manage all regulated online gambling in Ontario in conformity with Canadian federal law.
Unlike the published AGCO standards, contractual terms between operators and iGO are subject to non-disclosure agreements (NDAs) and have not been developed through public consultations.
But pending items are understood to include finalizing iGO’s responsible gaming and anti-money laundering programs that all operators will have to implement, plus matters relating to how taxes will be withheld before operators receive their share of the revenue generated by their sites.
Ontario’s effective tax rate for online gambling still has not been publicly confirmed, but is expected to be 20 percent, as was proposed by iGO in draft versions of the contract shared with interested operators last year.
The April 4 date is a pivotal one for those international companies with a strong existing customer base in Ontario that now must quickly decide whether to become registered and pay taxes or risk being squeezed out by new competitors or through future enforcement initiatives.
The province is not preventing offshore operators already active in Ontario from applying, provided they can meet the regulatory standards. However, any companies that decline to enter the regulated market once it launches and then continue to accept bets from Ontarians may be precluded from joining in the future.
In a notice regarding the April 4 launch, iGO said that any operator intending to join the regulated market should promptly file for an AGCO registration and execute an NDA regarding the commercial contract.
For its part, AGCO said it had been actively processing registrations since September and that regulators’ “goal over the coming weeks and months is to work with current applicants and other operators and gaming-related suppliers that have not yet submitted their applications, to help prepare them for the new online gaming market.”
Although several Canadian-based operators preparing for the Ontario market issued statements on Friday welcoming the April 4 launch date, reaction was not universally positive.
In a statement to the Toronto Sun, Great Canadian Gaming CEO Tony Rodio said the company was disappointed by the announcement and “supports fair, competitive gaming rules, and unfortunately the current iGaming framework falls far short of that.”
The Mississaugas of Scugog Island First Nation, owner of the Great Canadian Gaming-operated Great Blue Heron casino an hour north of Toronto, said Ontario’s online model was “deeply flawed” and the province had failed to meet its constitutional responsibility to consult with First Nations over its plans.
“We intend to challenge the province’s iGaming scheme in court,” said Chief Kelly LaRocca.