Ontario sets doomsday clock on illegal operators

If you are an unregulated gambling entity in the Ontario market, you better buckle up. The Alcohol and Gaming Commission of Ontario (AGCO) has issued an update that it will be shutting down all operators without a license, including affiliates and suppliers, come October 31.

This is the end of a so-called grace period that was issued following the launch of regulated gambling in the market on April 1, 2022. Now, though, the transitional period is over, and any unregulated company would need to leave the market or face regulatory action.

This may not sound too scary coming from AGCO. After all, the commission, the province of Ontario, and Canada as a whole do not have a reputation for being hardliners on offshore gambling.

In fact, online sportsbooks and iGaming brands, including established names such as Betway and Bet365 benefited from a grey area status long before the activities were regulated in Ontario or anywhere else in Canada. But this is now going to change as AGCO wants to ensure that the regulated gambling market makes the most out of it.

Effectively, the regulator expects any entity to be fully aware and compliant with the regulatory norms in Ontario. The regulator also reminded us that companies that are in the process of transitioning to the regulated market but do not have the necessary licenses will also have to shut down.

AGCO will continue to work with any entity that wishes to find out and understand how the regulated market in the province works, though. Any new applicants will have to also understand the prerequisites for entering the market and comply with them.

The Commission used the latest reminder to also give a quick overview of the results achieved over the past months. Ontario was touted to launch as one of the biggest iGaming and sports betting markets in North America, but the report covering the first quarter of operations noted only CA$4bn in total wagers over the first three months.

Revenue for operators was CA$162m across 18 operators and 31 iGaming websites. Ontario is trailing behind other big iGaming markets in the United States such as New Jersey, Pennsylvania, and Michigan, all of which posted impressive results in comparison. Second quarter results from these jurisdictions stood at $577m for New Jersey, $521m for Pennsylvania, and not least $466m for Michigan.

Does this mean that Ontario’s much-anticipated gambling market launch flopped? Yes and no – it still remains to be seen how well local gamblers can be channeled. With its 16m residents, Ontario remains an important market and one that is brimming with potential.

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