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Change on The Horizon: Canadian Government Looks Set to Shake up Betting Industry

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Although for many years Canada has lagged behind its close counterparts when it comes to online gambling, the online betting industry in Canada looks set to undergo a major overhaul in the coming months and years. This comes as legislators look set to pass through a significant reform of online sports betting laws.

Although it is not strictly legally permissible within Canadian territory, Canadian sports fans spend an estimated $14bn per year through alternative betting channels as a workaround to the existing limits on sports betting. While online casinos have been legal for quite some time — and their status and regulation varies between territories — Canada has lagged behind when it comes to sports betting. For this reason, the proposals for a new sports betting regulatory regime set out in the bill introduced last Thursday looks set significantly liberalise and open up the betting and gambling industry in Canada.

In terms of the current restrictions on sports betting within Canada, as it currently stands, Canadians are only allowed to place parlay bets. This means bets are limited to multiple bets on a game and to picking a winner. Currently, this industry is worth about $500m per year, which pales in comparison to the aforementioned $14bn Canadians place on sports betting through alternative channels each year. In this sense, the proposals set out in the bill would not only significantly open up the betting industry within Canada, but could also potentially provide a significant amount of revenue for federal authorities.

The proposals would vest power in the provinces and territories to offer single-event sports betting within their jurisdiction and to oversee its development and regulation. Importantly, this would apply either in online casinos or land-based casinos.

By allowing for the regulation of sports betting in this way, the Canadian government is allowing for its safe regulation at a provincial level. In fact, given that so many Canadians are already using back-channel approaches to place sports bets using overseas providers, expressly regulating for sports betting in this way would allow for greater regulation of the market more generally. In the long run, the proposed bill is a significant step forward from a customer safety perspective.

With this reform, Canada follows in the footsteps of the United States, which has significantly relaxed longstanding prohibitions on certain types of gambling and sports betting. Following a US Supreme Court decision in 2018, a federal limit on sports betting was deemed unconstitutional, which had for decades limited sports betting other than in Nevada. This decision by the Supreme Court lead to a wave of development within the US sports betting industry. Within a matter of a few months, numerous partnerships had been announced, with hundreds of sports betting sites launched within the same year.

With all this in mind, the proposals put forward last week represent an exciting new development for the many thousands of sports betting fans who have for years lamented the restrictions currently in place in Canada. Numerous homegrown Canadian gambling companies are eagerly awaiting further announcements, with many more US sports betting companies eying up further expansion into the Canadian market.

Although a specific timeframe has not been set out, it does seem that the current Canadian government is taking this proposal seriously and is pushing it forward. Additionally, whether or not this proposal gets passed, and the final shape it will take, will also need to be acceptable to the tribal gaming communities in order to determine how they will fit within this new regulatory regime.

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