Three Canadian lottery corporations have filed an appeal in the Supreme Court of Canada to challenge the Ontario Court of Appeal’s ruling that Ontario could connect players of peer-to-peer iGaming games with users in other countries.
Manitoba Liquor and Lotteries (MBLL), the British Columbia Lottery Corporation (BCLC) and the Atlantic Lottery Corporation (ALC) have all contested the opinion that was issued in November in the Ontario court. MBLL and BCLC are listed as joint appellants, while the ALC is a separate appellant.
Ontario AG Doug Downey is the respondent in the case, titled “Atlantic Lottery Corporation, et al. v. Attorney General of Ontario. Downey’s office provided no comment when asked by Canadian Gaming Business.
Lotteries opposed since original question
As members of the Canadian Lottery Coalition (CLC), MBLL, BCLC and ALC were intervenors in the reference question posed to the Ontario Court of Appeal in early 2024.
Ontario’s rules currently fence in online poker and paid DFS, mandating that all players must be located within the province’s borders. Ontario’s AG, the Canadian Gaming Association (CGA), GGPoker owner NSUS, and FanDuel and PokerStars parent Flutter wanted to know whether it would be legal under the Criminal Code for Ontario to connect its players with players in other jurisdictions.
They argued that a pooled-liquidity model should be legal because the Ontario end of such a game would be conducted and managed within the province, like other regulated Ontario iGaming. The CLC’s lotteries and the Mohawk Council of Kahnawà:ke (MCK) contended that it would be illegal as not all play would be physically located in the province.
After many months of deliberation, four members of a five-judge panel agreed with Ontario, while the other aligned with the lotteries.
Lotteries dispute issue of location
The Ontario Court of Appeal’s decision pointed to language in the Criminal Code that states that “it is lawful for the government of a province, either alone or in conjunction with the government of another province, to conduct and manage a lottery scheme in that province, or in that and the other province, in accordance with any law enacted by the legislature of that province.”
“The phrase ‘conduct and manage a lottery scheme in that province’ can be read narrowly to prohibit linking in-province gaming to gaming in foreign jurisdictions,” the judges wrote in the verdict. “However, a broader reading that permits provincial governments to enter into cooperative arrangements with foreign jurisdictions is also available. On our reading, the text favours this broader interpretation.”
Once the Ontario Court of Appeal published its judgment on Nov. 12, parties involved in that case had 30 days to appeal. ALC filed a notice of appeal with the court on Dec. 10 and the file was officially opened on Dec. 18.
In the appeal, the lotteries reasserted their stance that the phrase “in that province” in the Criminal Code should be interpreted to mean entirely in that province, as opposed to “from” or “partially in” the province. They also rejected the Ontario AG’s submission that the phrase should be interpreted to mean “having a real and substantial connection to that province.”
Pump the brakes, for now
The Court of Appeal decision noted that there is no real blueprint for how Ontario would look to actually implement and operate an internationally pooled model. But iGaming Ontario (iGO) President and CEO Joseph Hillier told Canadian Gaming Business after the Ontario court decision that the iGaming conduct-and-manage agency is excited by the possibilities.
“I think the opportunities could be significant,” he said. “There’s definitely an eagerness to move things along as quickly as possible. But at the same time, it’s understanding where the true opportunities are. Peer-to-peer poker is something that people have spoken about, daily fantasy, maybe even super progressive jackpots on the casino side.”
The Ontario judges’ determination and their interpretation of the Criminal Code’s language also left open the possibility that the Ontario government could strike deals with other provincial governments to allow gamblers to play against each other. Hillier floated the idea to CGB of potential conversations between Ontario and Alberta about potentially pooling players once the latter province has its own regulated commercial iGaming market up and running.
Now, though, the appeal from multiple lotteries will kickstart what could be a lengthy review of the Ontario verdict in Canada’s highest court. Based on the quick opposition from Manitoba, B.C., and the Atlantics, as well as those provinces’ longstanding chagrin at seeing adverts for Ontario-licensed iGaming operators in their own jurisdictions, deals between Ontario and those provinces seem unlikely.
In the meantime, it’s time for everyone to hold their horses.
