ONTARIO ONE YEAR ON
Blowing out the candles! The first year of Ontario’s gaming market has been a commercial and regulatory success. From a commercial perspective, 44 operators are registered by the AGCO, which includes a significant portion of what was previously the “grey market”. According to iGO, the province of Ontario is one of the top-five largest North American iGaming jurisdictions. From a regulatory perspective, the AGCO has successfully facilitated a smooth transition for grey market operators and created commercial and regulatory hurdles for grey market operators applying after the transition period. The AGCO has also demonstrated a commitment to player protection by fining operators who violated advertising standards and prohibiting betting on markets with inadequate integrity oversight. The AGCO showed that it is solution-focused by working with the UFC to establish adequate integrity oversight for UFC betting. In situations where the AGCO may have exceeded its regulatory scope (such as trying to regulate operators’ and suppliers’ global associations), it narrowed its focus on registrants’ Ontario activity. Legally, Ontario’s iGaming framework is built on a creative interpretation of the phrase “conduct and manage,” as such phrase is used in the Code. The MCK is challenging whether iGaming Ontario truly “conducts and manages” gaming. The result of the challenge could close the Ontario iGaming market or may embolden other provinces to adopt a similar approach. Ontario’s iGaming market is healthy, growing, and in good stewardship. The results thus far have shown Ontario to be a leader in the North American iGaming market. Let’s hope that Ontario iGaming can avoid the “terrible twos”. Thanks to Zack Pearlstein and Will Sarwer-Foner Androsoff for their invaluable assistance with this article.
funds, and various other rights related to gaming in Ontario. In December 2022, the Mohawk Council of Kahnawá:ke (MCK) filed an Amended Notice of Application for (i) a declaration that the Ontario government does not “conduct and manage” online lottery schemes (iGaming Schemes); (ii) an order quashing the iGaming scheme because it is ultra vires the Ontario government’s authority; and (iii) in the alternative, an order declaring the iGaming scheme inoperative. MCK has a longstanding interest in gaming and wagering. The Kahnawá:ke Gaming Commission has been regulating gaming from within Canada (on Kahnawá:ke Territory) for over 25 years. MCK’s position is that online lottery schemes established under the iGaming Scheme are not conducted and managed by the Ontario government because private operators (not the province): 1. Own and operate their own proprietary platforms; 2. Are responsible for key decision-making activities; 3. Are responsible for meeting compliance obligations for their gaming sites; 4. Have authority to retain suppliers in relation to the gaming site; and 5. Are the primary beneficiaries of revenue generated by the iGaming Scheme. A hearing for MCK’s legal challenge is set for February 2024. If the MCK is successful, the Ontario iGaming market will cease to exist in its current state. If MCK’s challenge is unsuccessful, any provinces who were reluctant to shift from a monopoly model to a quasi-licensing model may have additional comfort that the “conduct and manage” framework set up by Ontario would hold up in the courts.
JACK TADMAN Principal GME Law For information contact +1 647 567-1742 jack@gmelawyers.com
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IMGL MAGAZINE | APRIL 2023
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