With a new license in Ontario opening up new opportunities for the iGaming industry, we explore the ins and outs of what those opportunities look like and how to be on the right side of the change to expand your business in Canada.
What is the Ontario Gaming License?
In April 2022, Canadian province Ontario launched the countries' first iGaming license for online operators, with applications received from casinos and sports betting sites immediately. With gambling already a major market in Canada, the Ontario Gaming License is an opportunity for the country to increase revenues, retain revenues that are otherwise being gambled offshore and most importantly, gain greater oversight and control over those platforms appealing to Canadian players.
The license will be overseen by iGO, iGaming Ontario, under the provision of the AGCO. The iGO is in place to regulate the iGaming industry under the Ontario License and form key objectives across Consumer Choice, Consumer Protection, Legal Market Growth and Provincial Returns (the real reason).
By making iGaming more accessible to operators within Canada, the likelihood is revenues will remain provincial and bring greater benefits and lead to more places adopting similar opproaches to Ontario.
Gambling & Betting in Canada
Gambling is legal in Canada, but with rules and regulations on a Provincial level, it's certainly not always clear what's legal and what's not. With an estimated C$14billion a year in revenue, the confusion certainly hasn't put off everyone.
As with most places, if you're looking to place bets or gamble on slot machines then you're more than likely going to do so online. This has seen a huge boom in online casinos and sportsbooks globally and while this is legal for Canadian residents, it's actually illegal for operators to be based inside or have any form of operations from Canada. The following provinces have various gaming regulations:
- Quebec
- Alberta
- British Columbia
- Manitoba
- Ontario
- New Brunswick
- Nova Scotia
- Newfoundland and Labrador
- Saskatchewan
- Prince Edward Island
- Northwest Territories
- Yukon Territory
The majority of online operators for Canadian players are licensed from either MGA (Malta gaming authority), UKGC (UK Gaming Commission), Kahnawake or Curacao. The Ontario Gaming License is now opening up additional opportunities for platforms with these licenses as well.
Why get a gaming license in Ontario, Canada?
With strong regulation already in existence in Europe and curacao, there could be an argument for why this license would be of interest to existing or new operators in the gaming space. Certainly for Canada on the whole, the opportunity to now create, operate and run a successful homegrown casino or sportsbook will certainly appeal to entrepreneurs and existing businesses in the space with a real opportunity to thrive and even benefit from early adoption or first move advantage.
The license will come with additional requirements, discussed below, but the advantages of being able to operate legally under the vision of the AGCO will bring additional trust for players when visiting operators, greater protection for players in their home country (unlike when playing offshore) and significant opportunities for the operator to generate huge revenues in what may be considered an untapped market -with an already C$14bn revenue stream.
Each licensed operator will work alongside the iGO, working as private contractors to a government body, meaning they have direct input on the future of iGaming in the province and Canada as a whole.
Why is it different to operators like Curacao or MGA?
In a way it's not hugely different from a gaming perspective. The requirements are similar to that of licenses who operate with strict KYC/AML policy requirements though, which is where the differences to Curacao are particularly apparent but where even the UKGC are behind outside of simple name verification.
What are the operator requirements for the Ontario License?
KYC/AML
Operators must perform Know your customer and anti money laundering checks on every player. This is to ensure the platform itself is not accepting finances from sources it shouldn't and therefore facilitate criminality or even terrorism, one of the major fears for the iGaming industry as a whole.
Credit File
As part of a sufficient KYC check, player verification must come from a Canadian Credit Bureau with data from the past 3 years across multiple sources, while consumer details must also match any identity or document checks.
Dual Source
KYC providers are required to provide results from multiple sources in order to qualify as suitable to the Ontario Gaming License regulation. This has led to a scrabble by KYC providers to change processes to offer a solution to those setting up in Canada.
Document Verification
As with any KYC check you may have done for a bank account or even for a MGA license Casino, a document such as a passport or photo ID and proof of address documents will be required for checks. This is fairly standard procedure in finance but not in iGaming, but these changes will support safer the growth of the sector.
AML (Anti Money Laundering)
Less known about that KYC, an AML check will look at PEP and Sanctions lists, adverse media and be required to carry out monthly monitoring checks on all players for any changes in circumstances - more akin to a bank than an online Casino.
Will this put players off?
How to get a gaming license in Canada?
Acquiring an Ontario Gaming License is similar to other regulators, with a fee and significant application and approval process. The fee is C$15,000 for the application and on acceptance C$15,000 per year with a 4 year refresh requirement of the license to ensure ongoing compliance.
The issue will be the length at which Ontario have gone to protect consumers and regulate the industry as a new standard - making it easier to outline the requirements and much harder to mee them for existing operators under more lenient controls currently.
PCMLTFA and FINTRAC requirements cover Canada as a country and determine the requirements at a national level, while the Ontario License sits below those and meets more specific requirements on source of wealth and preventing underage gambling.
Who are iGO?
A new created organisation in Canada, the iGaming Ontario group is facilitating and overseeing the growth of the iGaming market in Ontario Province since the removal on the prohibition of single-game betting in Canada in 2021.
Entering into agreements with the operators or providers of iGaming in Canada, the iGO will ensure compliance of rules and regulations laid out by the AGCO. With only 4 board members the organisation is not vast, will be oversee a very specific set of guidelines to regulate iGaming (and seemingly keep revenues from gaming within Canada and Ontario specifically).
The most important thing to note for any operator looking to operate in Ontario is they will be private contractors to the iGO organisation, providing gaming as a service through a commercial partnership.
Who are AGCO?
The AGCO is the Alcohol and Gaming Commision of Ontario and they're responsible for the regulation of not only Alcohol and Gaming but sports betting, horse racing and even retail Cannabis activities in Ontario. Reporting directly to the Ministry of the Attorney General (whatever that is) it oversees the iGO to ensure proper regulation if igaming within the province. Founded in 1998, the commision has overseen all things gaming, with major updates in 2021 leading to the new frameworks for the Alcohol and Gaming Commision of Ontario Act.
What does the AGCO actually do?
A common question when it comes to regulators. Covering so many markets and activities within Ontario, their oversight it quite broad, operating across:
- Developing regulatory standards
- Eligibility and registration of iGaming operators and suppliers to maintain integrity of the sector
- Register ITLs (Independent Testing Labs) to certify and test the standards and requirements of iGaming platforms and tech
- Monitoring of operators, suppliers and game providers within iGaming to ensure compliance with their regulatory obligations
- Re-engage with operators or suppliers who fail to meet compliance obligations, issue warnings, sanctions, penalties and revocations
- Increasing understanding of the regulatory frameworks with operators and suppliers
- Address regulatory complaints (naughty)
Who has an Ontario Gaming License already?
Well according to the iGO, the list is growing quickly, although many were approved prior to the April launch.
What have the press said about the new Canadian Gaming License?
888 secures igaming licence in Ontario
https://igamingbusiness.com/gaming/online-casino/888-secures-igaming-licence-in-ontario/
Ontario Gaming License
https://torontoguardian.com/2022/04/ontario-gaming-license/
Playson receives online casino license to operate in Ontario
https://sbcamericas.com/2022/09/01/playson-online-gaming-license-ontario/
ComeOn Group secures gambling license for Ontario
https://sbcamericas.com/2022/04/26/comeon-group-secures-gambling-license-for-ontario/
Entain's Sports Interaction brand secures online gambling license to operate in Ontario
https://www.yogonet.com/international/news/2022/09/09/64185-entain-39s-sports-interaction-brand-secures-online-gambling-license-to-operate-in-ontario
INSPIRED ENTERTAINMENT RECEIVES GAMING-RELATED SUPPLIER LICENSE FROM THE ALCOHOL AND GAMING COMMISSION OF ONTARIO
https://inseinc.com/inspired-entertainment-receives-gaming-related-supplier-license-from-the-alcohol-and-gaming-commission-of-ontario/
LEOVEGAS OPENS FOR REGULATED GAMING IN ONTARIO, CANADA
https://leovegasgroup.com/en/investor-relations/press-releases/2022/leovegas-opens-for-regulated-gaming-in-ontario-canada/
Altenar Gets Started in Ontario with AGCO License
https://www.gamblingnews.com/news/altenar-gets-started-in-ontario-with-agco-license/
