New regulation in Canada has seized the attention of the worldwide gambling community for a reason — the country has huge potential. New laws can be tricky to understand, especially when regulations differ from province to province, but this article will break down Canadian regulations and provide an overview of the Canadian gambling market.
Gambling is a widely accepted form of entertainment among Canadians, unlike in other countries with cultural taboos against gaming. Since the middle of the twentieth century, gambling legislation has gotten progressively more liberal, and in the past decade provincial gaming authorities have been opening websites in order to fully embrace the modern age. Aside from certain authorized providers, provincial governments have monopolies on offering gambling services to Canadian citizens. But of course, the biggest story about the Canadian market in recent years is the province of Ontario’s recent move to regulate private online gambling operations. Keep reading to learn more about the Canadian market.
A quick history of Canadian gambling
Though gambling is widely accepted in Canada — on average, six in ten Canadians participate in some form of gambling — organizing it for purposes other than charity was completely illegal in the country until 1970, when the Criminal Code transferred the authority to regulate gambling from the federal to the provincial governments, and regulations have grown even more accommodating over time.
The revenues gambling can generate give provincial governments a powerful motivation to make at least some forms of gambling available. Some provinces, seeing the potential of gambling, granted concessions to establish land-based casinos and horse tracks on their territory in 1990s; later on, video lottery terminals were allowed.
The rewards of regulation are readily apparent. For example, the British Columbia Lottery Corporation has brought in CAD 21 billion for the province since 1985, including CAD 1.4 billion in the 2018-2019 fiscal year. The benefits are measures in more than just dollars; gambling tax revenues are used by provincial governments to support cultural programs and other social initiatives.
However, until recently, only offline establishments were open in the country. When online gambling was legalized in 2009, Canada didn’t provide any licenses for online operators, except state-run online casinos in separate provinces: the first was the British Columbia Lottery Corporation, which opened PlayNow in 2010. Loto-Québec launched espacejeux.com the same year, and Manitoba followed suit in 2013, trying to tap into the estimated CAD 37 million citizens were spending on offshore sites every year.
No legal online casino from abroad was based in the country, so players who didn’t like the state monopoly options were pushed to use offshore websites’ services, which didn’t cause any discomfort — launching a casino platform in the country was not allowed, but the government never went so far as to prosecute players for visiting offshore sites.
In fact, it’s doubtful authorities would even have the power to curtail offshore gambling. In 2016, the government of Quebec passed Bill 74, which would require internet service providers to block users from accessing offshore sites. However, the bill was challenged by the Canadian Wireless Telecommunication Association, and the Superior Court of Quebec ruled the bill unconstitutional, as it overstepped provincial authority regarding both criminal and telecommunications law.
The legislation has grown more and more liberal over time. In 2021, the Canadian government legalized online bets on single games (previously, only perimutuel betting was allowed). Some provinces offer their own online casinos, but still didn’t register any foreign companies. On April 4, 2022, the shadows covering online gambling in Canada were dispelled — the province of Ontario legalized iGaming, and since that moment, every gambling company willing to provide services to Canadian players in the province has been legally able to do so.
Gambling regulation in Canada 2022
Canada is a federation divided into 10 provinces and three territories. At the federal level, the industry is regulated by the Criminal Code of Canada, which states that gambling is illegal unless local authorities decide differently and manage their own markets. The Canadian Gambling Commission is responsible for overseeing the gambling industry and communicating with the government, the public, and the media, but it does not interfere with particular local laws: both online and offline gambling and betting are controlled on the province level.
Only charitable and religious organizations are allowed to offer gambling services. There is only one legal platform in the province, called PlayAlberta.
The Gaming Control Act of 2002 allows land-based operations in the province; however, there is only one regulated online casino, PlayNow.
The Liquor and Gaming Authority of Manitoba regulates offline and online gambling operations, but there is only one authorized website, PlayNow. Sport betting is permitted with a CAD 250 daily limit, the only sports betting website is Sport Select.
The Gaming Control Act allows offering gaming and sport betting services, but there is only one land-based casino and one betting website, Pro-Line.
Newfoundland and Labrador
This province doesn’t permit any regulated online or offline gambling operations except sport betting on Pro-Line website with a CAD 250 limit.
There are two government-owned casinos and the option to use Pro-Line platform services. No other opportunities for operators are available.
Prince Edward Island
The Prince Edward Island Lotteries Commission regulates gambling in the province, and can organize and manage lotteries on its territory. Players can also use a Pro Line sportsbook.
Players in Quebec have access to nine land-based casinos, a government-owned online platform, Espacejeux, and the Mise-O-Jeu sportsbook.
Online casinos can’t be based in this province. However, locals access the Sports Select sportsbook website.
Yukon, Nunavut, Northwest Territories
There are no online platforms based in these regions, and local players have only one option to play — offshore casinos.
Ontario is the most liberal province. There are several land-based casinos, and new legislation made it possible to organize online gambling.
Ontario is the only province in Canada that has so far decided to open its market to foreign companies and allow operators to enter the country. Instead of a classic licensing process, the Alcohol and Gambling Commission of Ontario (AGCO) took two years to develop a special system that would make it possible to control and maintain the industry, making it at the same time liberal and competitive.
The AGCO registers companies and authorizes them to provide gambling services to Ontario citizens. iGaming Ontario in this case signs an agreement with every interested operator and supervises its activity, monitoring and managing the gambling market in the province.
Both B2C and B2B companies can register at the AGCO. To do so, they must have their products and devices certified by an independent laboratory and provide a list of requested documents( such as an application, declaration of business entity and disclosures of persons connected to the entity), pay fees, and sign an agreement with iGaming Ontario.
B2C operators pay an annual fee of CAD 100,000 ($77,348) for each gambling website, while B2B providers are divided into two categories. Manufacturers of gaming equipment pay CAD 15,000 ($11,602), while suppliers of gaming equipment or services pay CAD 3,000 ($2,320).
Canada’s gambling market
Since Canadians are used to playing on offshore resources, they are already familiar with the industry and have their own experience and preferences. In that regard, the market is already fairly developed and there’s no need to embark on a player-education campaign
First of all, Canadians do play online. The government never discouraged them, and plus, the pandemic era demonstrated the convenience of living through our devices — Canadians included. According to Statistics Canada, 65% of Canadians over 18 years old played online casino games in 2021, and that year’s overall spend on sport betting was CAD 15 million.
Every online casino or sportsbook willing to enter the market should localize its website, and the important thing to remember in this case is that Canada has two official languages: English and French (especially important in French-speaking Quebec).
Another important aspect of localization is payment methods. Besides the classic credit and debit cards, Canadians use electronic wallets (Skrill, PayPal, Neteller etc.), Paysafecard (prepaid debit cards), iDebit, and ISTADebit. Additionally, 3.2% of Canadians — 1.2 million people — own cryptocurrency; cryptocurrency payment processors and exchanges are considered a legal Money Service Business in Canada.
Players in Canada are spoiled for choice by the competitive international gambling market, which is why it’s so important to make your offer as extensive as possible. Slots, card games, table games, live dealer games, and everything else that is in trend (read: newly released) at the moment.
Wait, what about Kahnawake?
The Mohawk territory of Kahnawake is a first nations reserve on Canadian territory that isn't subject to the Canadian laws. The Kahnawake Gaming Commission was created in 1996 as a regulator and licensing authority for online gambling operators, allowing them to base their servers on Mohawk territory.
Operating online casinos in Canada was illegal until 2021. However, as Kahnawake is technically its own jurisdiction, the KGC was able to issue licenses, set regulations, and offer hosting services unimpeded, despite the fact that these actions were recognized by Canada itself.
How can Slotegrator help?
Every step in the process of launching a gambling business is crucial. Experienced operators often prefer to delegate development to professional providers, whereas beginners start with a consultation. In any case, we recommend trying the easy way. The turnkey solution from Slotegrator enables operators to launch an online casino quickly and with minimal effort from the operators’ side — we’ve put over a decade of experience and expertise into this platform.
When the platform is ready, we recommend focusing on its content, namely games and payment methods. Such competitive markets as Canada require a serious approach to game selection — casinos need a truly unique offering to stand out from their competition.
And last but not least — entering an active but newly regulated market is easier with the help of someone who knows all the requirements. Contact our lawyers and get a consultation about jurisdictions and licensing.