Ontario’s iGaming Liquidity Plan Faces Opposition from Lottery Coalition

A coalition of government-owned lottery corporations is urging the Supreme Court of Canada to reject Ontario’s proposal to pool iGaming liquidity with other jurisdictions. This initiative could potentially enhance online poker and revive paid daily fantasy sports (DFS) in the province.

The Canadian Lottery Coalition (CLC) argues that allowing Ontario residents to participate in online poker and DFS contests with players from Texas and other regions could set a troubling legal precedent. The CLC emphasizes that the ramifications of this decision extend beyond immediate concerns about international liquidity.

Coalition Raises Legal Concerns Over iGaming Plan

In a factum submitted to the Supreme Court, the CLC strongly opposed Ontario’s plan. They argue that it could lead to provinces asserting authority over national lottery schemes.

“While the issue today is international liquidity, the next case may involve a province seeking to assert authority to conduct lottery schemes that extend across the country,” the CLC stated.

The filing is part of their effort to challenge a majority decision by the Ontario Court of Appeal in November that allowed gamblers to engage in peer-to-peer games with people outside Canada. The CLC argues that Ontario’s proposed scheme violates Canada’s Criminal Code. A main concern for the coalition is the conduct of brands associated with Ontario-regulated operators. The coalition accuses them of enticing customers from other provinces while ignoring illegal gambling activities.

Illegal Gambling and Market Impact Concerns

The CLC claims that unlawful operators diverted an estimated CA$1.86 billion in profits away from provincial governments in 2023. They argue that Ontario’s proposal lacks clarity regarding which international platforms would be involved. The coalition believes that Ontario intends to collaborate with international affiliates already charming Canadian players outside of Ontario.

The coalition’s efforts reflect the contentious atmosphere surrounding Ontario’s regulated online gambling market, which was established in 2022. It was the first of its kind in Canada, allowing private operators to offer gambling entertainment under provincial regulation. The province now has over 80 regulated sites, but still struggles with a grey and black market that undermines its regulatory framework.

What’s Next for Ontario iGaming Market

In February 2024, the Ontario government questioned its top court regarding the legality of linking with international partners. It is believed that sharing iGaming liquidity with foreign jurisdictions could strengthen its sports betting and online gaming market.

While Ontario’s competitive iGaming market offers many games, it notably lacks operators offering paid DFS contests. Most platforms like DraftKings and FanDuel have exited the DFS market in Ontario, focusing instead on sports betting and online casino games.