Bill legalizing single-game sports betting passed in Canada

Bill legalizing single-game sports betting passed in Canada

Gambling

Bill legalizing single-game sports betting passed in Canada

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On April 22nd, 2021 Canada created Bill C-218 which stipulates 

“This enactment repeals paragraph 207(4)‍(b) of the Criminal Code to make it lawful for the government of a province, or a person or entity licensed by the Lieutenant Governor in Council of that province, to conduct and manage a lottery scheme in the province that involves betting on a race or fight or on a single sports event or athletic contest.”

This means Canadian provincially licensed gambling operators will allow Canadians to bet on a single game instead of previously only allowing parlay bets on sports.  Parlays are three-game minimum connected bets which are a bookmaker’s dream as the odds of winning are low.  Why did Canada introduce this bill?  What is the recent history of sports betting in Canada?  What are the effects on Canadian citizens by offering sports betting? And what is the future of gambling in Canada?

We’ll try and answer these questions in this article.

Why did the Canadian Government pass Bill C-218?

July 28, 2020; Toronto, Ontario, CANADA; Goaltender Frederik Andersen #31 of the Toronto Maple Leafs looks on after Tomas Tatar #90 of the Montreal Canadiens scored in the second period of an exhibition game prior to the 2020 NHL Stanley Cup Playoffs at Scotiabank Arena on July 28, 2020 in Toronto, Ontario. Mandatory Credit: Mark Blinch/NHLI via USA TODAY Sports

This bill will allow provincially (OLG: Ontario, BCLC: British Columbia, Espace Jeux: Quebec) regulated gambling operators to compete with non-regulated brands offering online sports betting to Canadians who have been offering single-game betting to Canadian citizens for many years now.  Canadians are smart and resourceful, so why would they gamble at a provincially regulated sportsbook where they were forced to bet a 3 game parlay when there are hundreds of ‘offshore’ online gambling operators where they can place a wager on a single sports match online from the comfort of their homes.  The Canadian government basically woke up and realized that all of the monies from not offering single-game betting was being siphoned offshore and had no choice but to amend this bill as Canadians were opting to place their single-game wagers at ‘unregulated’ gambling operators as opposed to a terrible odds 3 game parlay at a provincially regulated operator.  Another reason for the bill was the Canadian government taking notice of our neighbors to the south; the United States of America.  New Jersey was the first state to offer its citizens regulated sports gambling which allows single-game betting and in-game prop bets (bet on who scores first in a game) and the numbers don’t lie.

“New Jersey set yet another new sports betting revenue record in January, with the state’s sportsbooks winning $82.6 million. That easily surpasses the previous revenue record of $66.4 million set in December 2020. The $82.6 million mark represents a 24% increase month-on-month and a 54% increase on January 2020.”

The Canadian government took notice of this revenue and is now scrambling to amend their sports betting laws to ensure Canadians place their wager at provincially regulated sports betting operators to reign in some of these tax dollars which are currently being sent offshore.  The US gambling market differs from the Canadian provincially regulated markets.  In the states, the award licenses to established casino operators to provide their sports betting and casino services whereas in Canada we have our own provincially run gambling operators which are run by the province and license out the software  – No licenses are issued to large casino operators outside of Canada to accept Canadian players.  Basically, Canada is a free market that allows provincially regulated operators to battle it out with offshore regulated online gambling entities.  The USA (in typical USA Fashion) basically went to war with offshore operators by implementing the unlawful gambling act back in 2006 which made it criminal for offshore online gambling entities to accept American’s money and they set up task forces to aggressively go after the banks and credit card processors which facilitated online gambling transactions in America. 

CNN Report on the unlawful gambling act

Now,  will Canada follow suit and pass a law similar to the unlawful gambling act and shut down offshore operators by targeting their processors and bank account similar to the USA allowing the provincially regulated brands to have a monopoly on Canadian bettors?  This is where things get tricky, many offshore operators targeting the Canadian online gambling market have licenses at the first nation’s reserve Kanawakee which is located just outside of Montreal, Canada they offer online gambling licenses to operators targeting the Canadian market. Technically, the Kanwakee reserve is deemed a sovereign nation outside of Canadian laws so the Canadian government does not have the authority to step in and disallow these licenses from being issued.  Furthermore, is the Canadian Government going to tell a first nations community what they can and can’t do as a sovereign nation.  I guess only time will tell….

What is the recent history of sports betting in Canada?

To answer this question we are going to focus on online gambling as Canadian’s played a huge role in the evolution of online gambling and two Canadians in particular’; Calvin Ayre and Isai Scheinberg.  Calvin created the online sportsbook Bodog (founded in 1994) which is a household brand in Canada and Isai created PokerStars (founded in 2001) which is also a massively popular online poker website globally.  Calvin hails from Saskatchewan and Isai was born in Isreal but lived most of his life in Toronto, Ontario Canada.  Calvin is notorious for his ‘catch me if you can’ Forbes article which boasted the amount of revenue Bodog was attaining and basically thumbing his nose at US regulators which some say led the way to the unlawful gambling act.

Calvin Explaining his Forbes article 

Calvin was eventually put on America’s most wanted list and US authorities shut down Bodog’s operations in the USA but Bodog was still able to operate in Canada and to this day still accepting Canadian’s to place wagers at Bodog.  Calvin Ayre’s Bodog paved the way for most operators as their online sports gambling innovations and marketing tactics are still used to this day.  Isai created PokerStars in 2001 and was eventually shut down in America during the infamous Black Friday which saw all poker sites go offline in America and their websites replaced with America’s department of justice and homeland security logos.

CNN interview with American players after Black Friday

 

*The video above details Full tilt poker which was another popular poker site that was shut down during Black Friday and did not have the funds to reimburse players.  Isai’s PokerStars had the player’s account liquid funds available and reimbursed American players immediately.

The shutdown of PokerStars in America had no effect on the operations of the website in Canada as players were free to log onto the site and play.  PokerStars as a brand was hugely influential and is still one of the top poker & Real Money Online Casinos in Canada.  The world has two Canadians to thank for the evolution and popularity of online gambling.

What are the effects on Canadian citizens by offering sports betting?

Gambling is a vice and it has its negative effects on people with addictive personalities.  When Canada passed its single-game betting bill the Canadian news media quickly followed with interviews of heartbroken mothers who lost their sons to suicide as they accumulated large gambling debts and decided to take their own lives instead of having to pay it back.  One Candian media interview, in particular, went to the UK and interviewed how the UK government is dealing with the addiction problems and found they are limiting gamblers by instituting max wagering restrictions (how much a player can bet), max deposit (how much a player can deposit) and know your customer (provide a drivers license and bank statement) enforcement in the UK to detour the kids of the world from accessing their mother’s credit cards and wagering their life savings at an online sportsbook.  Will Canada follow suit and implement these measures for Canadian citizens on its provincially regulated casinos and sportsbooks?  Or, will this measure do as the aforementioned 3 game parlay and force Canadians to play at the unregulated offshore entities where there is no max wager or deposits for Canadian citizens?  Is Canada not ready to assist problem gamblers without full regulation of offshore entities as many players will continue to play at these unregulated offshore entities?  I guess only time will tell…

The future of Online Gambling in Canada

The future of online gambling in Canada is rather interesting.  Will Canada follow in America’s footsteps and make it illegal for offshore operators to accept Canadian players allowing provincially regulated brands full reign on all Canadian players.  This is where things get interesting, the reason the unlawful online gambling act was passed in America was due to the large online gambling operators lobbying the US senate to shut down the offshore gambling brands knowing full well that online gambling licenses would be awarded to them in the years to come – and they did!  The rhetoric around the banning of offshore operators in America was the negative effects it was having on their population but the silver lining was the licenses the casino operators and tax revenue that would be attained from banning offshore online gambling.  Now in Canada, it’s very different as provincially operated gambling boards do not have as much influence in getting laws passed in Canada as they don’t have the money nor are they willing to throw money at lobbyists to ban offshore operators.  Furthermore, will the Canadian government shut down operators currently using the first nation Kahawakee licenses, or will Canada remain a free market with each operator fighting over the Canadian bettors.  I think there will never be a shutdown similar to the United States as the Canadian differs from America – I believe we will continue down the path of having both regulated and offshore entities fighting it out for the attention of the Canadian gamblers.  The restrictions on marketing offshore gambling entities will become stricter and maybe payment processing will become more difficult while Canada ups the provincially regulated marketing budget and makes it easier for Canadians to wager and play at regulated provincial brands.  The games and betting markets will become more robust for regulated brands eventually competing and taking away the reason for Canadian players to play offshore and converting the players at the provincially regulated gambling operators.

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