Canada lawmakers feeling the peer pressure from US sports betting

Will It Be Third Time Lucky For Single-Game Sports Betting In Canada?

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For the third time in less than a decade, the Parliament of Canada is considering a bill to legalize single-game sports betting.

Bill C-218 would redact a single paragraph from Criminal Code of Canada which explicitly prevents provincial lotteries from accepting such wagers. It has support from two of the country’s major political parties, but not the current Liberal government.

Even so, proponents of sports betting say the bill has a better chance of success in 2020 given the emerging landscape south of the border.

Parlays are the only legal bets in Canada

The current situation for Canadian sports betting is effectively that of a gray market.

The Criminal Code lumps most forms of gambling under the umbrella of “lottery schemes,” allowing them to be organized in a limited way for charitable purposes. It also allows provinces to establish their own rules for larger-scale lotteries.

A few specific types of games are expressly forbidden, however, including single-game sports betting.

As a result, provincial lotteries only offer sports betting in the form of parlays. Some types of single-game wagers are legal due to generous interpretation of the law. For instance, exact score bets are considered a two-bet parlay — one bet on each team’s total.

Canada has five separate lottery corporations. The three most populous provinces — Ontario, Quebec, and British Columbia — each have their own. The other two lotteries serve the Atlantic and Prairie provinces respectively, and the latter also covers the country’s sparsely populated northern territories.

All five Canadian lotteries sell tickets online as well as at retail outlets, including these parlay-based sports wagers.

Offshore books do brisk business in Canada

These laws predate online sportsbooks. Retail sports betting in Canada is limited to parlay betting through the lottery and tribal sportsbooks on First Nations reserves. However, many offshore online sportsbooks accept Canadian customers.

This includes not only the same operators that serve the American market illegally, but also some of the same companies that operate with licenses in the US and Europe.

The Stars Group is a rare example of a gambling company that doesn’t accept Canadian customers, but the likes of bet365, William Hill, and Unibet all do.

Canada has neither legalized such sites nor made any attempt to crack down on them. They therefore happily continue to take Canadian business without an obligation to pay taxes.

Canadian lotteries together receive only about $500 million in bets annually. By contrast, international sportsbooks take an estimated $10 to $14 billion in online wagers from Canadian customers each year.

Leaving loonies on the table

Canadian politicians are well aware that they’re leaving a huge amount of money on the table. Political inertia has so far prevented them from moving in either direction, however, be it regulation or a crackdown. Either strategy would have its opponents, so the status quo remains despite having little upside.

A bill (C-290) very similar to the current C-218 came up in 2012. Despite strong opposition from professional sports leagues, it eventually passed the House of Commons in 2013. The Senate ultimately killed the proposal in 2015, however, due in part to pressure from the Toronto Blue Jays baseball franchise.

That was an election year, and the outcome was a change in power from a Conservative Party majority to one for the Liberal Party. Another attempt to remove the prohibition on single-game wagering in 2016 was met by opposition from Conservative MPs whose party was no longer in charge.

The third attempt, Bill C-218, appeared last month. There were signs it was coming as of this time last year, however. The Toronto Sun revealed at that time that Vic Fedeli, the Finance Minister for the province of Ontario, had sent a letter to his federal counterpart advocating for such an amendment. Canada’s most populous province is also spearheading other forms of gambling expansion, and Ontario online casinos could soon become the country’s first privatized iGaming.

Bipartisan effort in a multi-party system

The current effort is bipartisan. In Canada, however, that doesn’t mean quite what it does in the US. Canadian politics involves more than two parties.

Bill C-218 was introduced by Kevin Waugh, a Conservative MP with a background in sports journalism. Its co-sponsor is Brian Masse, who was behind the original single-game wagering bill in 2012. Masse is the MP for Windsor West, so the presence of the Caesars Casino there influences his stance on the issue.

Masse is a member of the New Democratic Party (NDP). Situated to the left of the Liberals, the NDP stands opposite the Conservatives on the political spectrum. Even so, the two often end up cooperating on issues when the Liberals are in power. That’s especially true when it’s a minority government, as it means that other parties working together can outvote the ruling party.

The Canadian House of Commons consists of 338 seats. It therefore requires 170 votes to be sure of passing a bill. The Conservatives currently hold 121 seats, and Waugh says he believes he can count on about 100 of them to vote for it. The NDP fared poorly in the last election and can only contribute a further 24 votes, even if their members are unanimous.

Other parties — the Greens and the Bloc Québecois — plus a single independent MP could contribute a further 36. Even so, that only makes 160 votes. Unless Waugh can convince the rest of his party to join him, he’ll need at least 10 Liberal votes to get C-218 into committee with the Senate.

PASPA repeal a game changer, even for Canada

Not having the support of the ruling party certainly jeopardizes the bill’s chances of passage. If it can make it to the Senate, however, it would stand a much better chance than C-290 did in 2012-2015.

That’s largely because of what’s been happening in the US over the last few years.

The Supreme Court decision to repeal PASPA in 2018 may not have affected Canadian law directly, but it did result in a big swing in the attitudes of American professional sports leagues. Formerly opposed to sports betting, new partnerships and data deals have suddenly created a financial interest in the industry’s success. As a result, they’d prefer to see it regulated rather than left in a gray area.

Another related factor is the legalization of sports betting in Michigan and New York. Both states have casinos close to the US-Canada border. That means Canadian casinos similarly close to the border will be losing business to those on the American side if the latter can take sports bets and they cannot.

Waugh said as much in an interview (beginning at 21:30) for the Danielle Smith Show on Global News Radio. He believes that if the bill can muster enough votes in the House, support of the leagues and revenue lost to cross-border betting should be enough to get it through the Senate and into law.

If it fails, however, it’s hard to know when the next opportunity to try will come. It probably wouldn’t happen until after the next election, which could potentially be as far off as 2023.

- Alex is a journalist from Dartmouth, Nova Scotia, Canada. Now site runner for Online Poker Report, he has been writing about poker and the online gambling industry in various capacities since 2014.
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