The news was announced last week that single-match betting would certainly soon be allowed in Canada. This is good news for players in a country where gambling and sports betting are still largely unregulated.
Understanding the context of Canada’s sports betting ban
The criminal law system in the US is divided between federal and state jurisdiction. In the area of gambling regulation, jurisdiction has traditionally rested with the states, with some notable exceptions such as the Wire Act and PASPA.
However, in Canada, the federal government has the power to establish criminal laws throughout the country. Provincial authorities retain the ability to regulate minor offences, known as provincial offences.
Section 202 of the Criminal Code of Canada is the law that currently prohibits the operation of gambling businesses and therefore single-game sports betting. However, section 204 of the Criminal Code created the exceptions that allowed for the parlay-style system that has become popular across the country.
The last major change to Canada’s gaming laws occurred in 1985. The adoption of single game betting is a position that has been pushed repeatedly in recent years. Indeed, Windsor-area MPs lobbied aggressively to legalize single-game sports betting during the early days of the Christie lawsuit in New Jersey.
Opposition to legalization came from many of the same parties that sued New Jersey to oppose legalization efforts in the Garden State.
In 2012, many of the major US sports leagues, as well as the NCAA (which has only one member institution in Canada), sent last-minute letters reiterating their advocacy against single-game sports betting to members of the Canadian Parliament. This effectively killed Bill C-290, which had almost reached the final reading without much opposition.
This 2012-2013 attempt was only the first of a number of recent efforts often launched as private members’ bills, which historically have little chance of passing. This is despite the fact that single-match betting has received more support than most private members’ bills.
Can legal single-match betting be a game-changer?
The hope with single match betting is that it will give a boost to the economies of the various provinces that offer these forms of gambling where they are allowed. The economic revival of the casino industry in the border city of Windsor has long been a catalyst for politicians in the region to support expansion initiatives.
This problem becomes more pressing with its American neighbour, Detroit, which has a thriving casino industry, especially after the legalization of sports betting in Michigan.
Of course, the success of single-game sports betting will depend very much on the broader health of the market, just as we have seen with the rollout of sports betting in the US. Some jurisdictions have been very successful, while others have built systems that are less successful because they limit state revenues.
What to expect in the coming months
Although the Ontario provincial government has released a budget that would allow private entities to enter a new iGaming space with the possible inclusion of sports betting, this has not yet happened. The move would see iGaming fall under the jurisdiction of the province’s Alcohol and Gaming Commission, which oversees a variety of industries, including horse racing and Ontario’s legal cannabis shops. Canada expected to legalize sports betting soon.
The idea of creating an iGaming market was already in the 2019 budget. This is likely to be a long one, with stakeholders on both sides likely to engage in a heated debate.
Ontario, in particular, has a complicated history of efforts to bring privatization to government monopolies (also known as public enterprises).
If this effort does indeed create a new market, as opposed to privatizing an existing one, it may well generate a different reaction. Even without a “free market”, private companies could still participate in the creation of Canadian Igaming. The other key area of expansion in Canada will be in mobile betting, for example. It is also worth noting that Ontario will soon legalize online casinos.
It can therefore be concluded that this announcement suggests an opportunity for Canadian operators to gain a competitive advantage and provide a different product offering in border cities than was available on the US side.