Canada’s changing gambling market

Canada’s online gambling market has been predicted to grow rapidly over the rest of the decade

IT MAY BE Canada’s neighbour to the south that has the big reputation for gambling with Las Vegas and New Jersey as the real hotspots.

But, as in so many areas, this is a country that punches way above its weight even though the population is only around 12% of the size of the USA’s.

And, although the last few years have seen a certain shrinkage in the market value for gambling, over the longer term the outlook is for continued growth. This is due to a number of reasons which we will shortly examine.

The laws as they stand

As with many countries around the world, the laws governing gambling in Canada are by no means clear-cut.

While there are certain national laws which affect businesses operating in the sector, others are set on a province-by-province basis.

In the case of the former regulations, these include the Proceeds of Crime (Money Laundering) and Terrorist Financing Act and operators also have to comply with the standards set by the Financial Transactions and Reports Analysis Centre.

Because the individual provincial governments are allowed to set their own laws these vary quite considerably. For example, in Newfoundland and Labrador only online gambling overseen by the Atlantic Lottery Corporation is permitted. However, in Manitoba the rules are less stringent with no specific laws preventing players from visiting offshore online casinos.

The size and shape of the market

In 2023 the overall size of the Canadian gambling market was estimated to be around CAN$14.2 billion while employing, directly and indirectly, nearly 34,000 people.

While it has seen a slight decline in size over recent years, a further period of growth is predicted, possibly at the rate of around 4% a year.

The reasons behind the shrinkage of the sector are largely economic with people finding themselves with less spare money to spend on all kinds of entertainment. So it’s not just the gambling sector which has been affected.

But forecasters are predicting that the corner has been turned and prospects for growth are good over the next few years. Something that will probably be reflected in increased revenues for gambling operators.

The drive to online

While bricks and mortar casinos will continue to attract players, it’s the online sector that promises to show the greatest growth.

In terms of online gambling providers, there is a very wide choice to choose from, and Canadians can head online to Gambling.com to see a list of gambling providers available. Most providers either offer casino games or sports betting options for Canadians.

The big attraction for many players is the chance to play “live” casino games. These feature dealers running games like roulette and blackjack in real time with the action being streamed to the player’s choice of device.

Virtual reality promises to be the next big thing in making these games more immersive and realistic than ever – and even more appealing to Canadians.

While the big centres of population have their own brick and mortar casinos, this will also give the more scattered members of the adult population the chance to enjoy the authentic gaming experience.

Mention must also be made of sports betting. The 2021 ruling that really opened up the market like never before has seen an increasing number of provinces change their stance on this. So, going forward, even greater liberalisation is on the cards.

The Ontario model

In terms of gambling legislation it’s Ontario that has undoubtedly led the way.

Whereas the province could simply have begun to issue licences to operators fulfilling certain criteria, the decision was made to create an organisation called iGaming Ontario.

Via iGO gaming businesses are allowed to operate as private contractors working for the government body. This sense of collaboration means that both parties are actively involved in shaping the future of the market.

Naturally, other laws such as the PCMLTFA need to be followed as well as other existing stipulations laid out by the Ontario Alcohol and Gaming Commission.

It’s this combination of fairly strict regulation to protect players along with co-operation with operators which has created a model other provinces may want to copy.

Alberta to follow?

At the moment, it’s Alberta that’s in the spotlight as the next province to come into line.

Attracted by the revenues raised by Ontario as part of its licensing agreements, the province recently passed Bill 16, aimed to simplify the expansion of the gambling sector.

The plan is to set up an independent administrator, like iOG, to oversee the granting of licenses and ensure compliance in Alberta. There’s no specific timeframe set out at the moment but we could probably expect to see the body come into existence in 2025.

Whether this will be a tipping point for other provinces remains to be seen. But the signs are that many others will be set to follow.