Ontario may have a legal pathway to expanding its online poker and daily fantasy sports (DFS) markets beyond its borders. The Ontario Court of Appeal stated on Wednesday that it believes it would be lawful to allow Ontario players to compete with players in other countries.
The provincial government asked the Court of Appeal in February 2024 whether legal sports betting and iGaming would remain legal under the Criminal Code if Ontario platforms were allowed to pool players of peer-to-peer games such as paid DFS contests and poker with players outside Canada.
Almost exactly one year since the issue got a three-day hearing in front of a Court of Appeal panel in November 2024, the Court published its decision on Nov. 12. Four of a five-judge panel agreed that such play would indeed be legal, an opinion that could start Ontario down the path towards revamping its online poker and DFS offerings.
Don’t ask, don’t get
Ontario’s rules currently fence in online poker and fantasy sports, mandating that all paid DFS and poker players must be located within the province’s borders to participate.
Under such restrictions, DraftKings and FanDuel decided to shut down their DFS operations in the province more than three years ago. As things currently stand, Ontario has no provincially regulated paid DFS options, while poker players on regulated Ontario platforms such as GGPoker, PokerStars, 888poker and BetMGM Poker can only play against other Ontarians, a state of play that limits the appeal for both customers and operators. On a consistent month-by-month basis, P2P poker accounts for only a tiny sliver (around 2%) of total wagering and operator revenue in Ontario’s regulated iGaming market.
Proponents of cross-border P2P play included the Ontario Ministry of the Attorney General, the Canadian Gaming Association (CGA), PokerStars owner Flutter and GGPoker owner NSUS. Those proponents argued that a pooled-liquidity model should be legal, largely because the Ontario end of such a game would be conducted and managed within the province like all other regulated Ontario iGaming. Players in other countries would be connected via a different web portal and would use international sites conducted and managed by their respective jurisdictions.
However, the Canadian Lottery Coalition (CLC), made up of several government crown corporations from other provinces, and the Mohawk Council of Kahnawà:ke (MCK) took the opposite view. They contended that Ontario would be a participant in a single game both home and abroad and that not all play would be physically located in the province, meaning that international pooled play should be illegal.
Judges find no objections in Criminal Code
The majority of the judges sided with Ontario.
“The proposed model would permit players in Ontario to play peer-to-peer games against players who are physically situated outside Canada, and to bet on the outcomes,” said the majority opinion. “Examples of the peer-to-peer games that would be permitted include poker and daily fantasy sports wagering.”
The court’s decision pointed to the Criminal Code’s language, which states “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 Court found that a pooled-liquidity model for DFS and online poker would clearly qualify as a lottery scheme. It also found that, while the Criminal Code is particular on how provinces can interact with one another, nothing precludes a province from offering international play.
“Parliament appears to have been concerned about preventing provincially-run lottery schemes spilling over into other provinces without the other provinces’ consent, rather than about preventing interprovincial spillover as something that was inherently contrary to public policy.”
“In summary, 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 added. “However, a broader reading that permits provincial governments to enter into cooperative arrangements with foreign jurisdictions is also available. On our reading, the text of s. 207(1)(a) favours this broader interpretation.”
One of the five judges disagreed, arguing that the proposed model would not meet Criminal Code requirements as it would engage Ontario in conducting and managing a lottery scheme outside its borders.
CGA hails ‘significant victory’
“This marks a significant victory for Ontario, bringing back a valuable option for consumers who enjoy pooled gaming activities such as poker and daily fantasy sports,” CGA President and CEO Paul Burns told Canadian Gaming Business in a statement.
“We look forward to collaborating with both the Province of Ontario and the Alcohol and Gaming Commission of Ontario as they begin implementing these changes.”
While the court sided with Ontario, that does not mean pooled peer-to-peer games in the province are right around the corner.
One or more of the provincial lotteries could appeal the decision. The CGA noted that the CLC has 30 days to appeal, but added that it believes “the strength of the verdict will encourage a measured response.” Meanwhile, the Ontario AG’s office told Canadian Gaming Business that it cannot comment on a court matter that remains within the appeal period.
What happens next for Ontario DFS and poker?
The road remains long. As the Court decision and Burns’ statement both noted, there are also scant practical details of how an internationally pooled model would actually operate.
It’s generally agreed that Ontario would be able to choose where to pool with, but would Ontario enter into agreements with the operators, the gaming regulators or the governments themselves? Who in Ontario would broker such agreements? Who would set the parameters of the games, such as entry fees and prize money? Numerous questions would need answering before this ever got off the ground.
Burns noted that there are no suggestions about a timeline for Ontario potentially initiating a multijurisdictional P2P model.
Still, it’s a milestone day for Ontario iGaming. DFS giants like FanDuel and DraftKings and Ontario’s licensed poker sites will be watching on with keen interest, and the cogs will already be turning.
