Until recently, the regulation of online gambling games in Canada didn’t have a single basis, and only in 2022 official info clarified this topic. Check out the data on online gambling regulation in Canada and the reasons why Canada has become open to the iGaming market.
Various facts have influenced the development of online gambling in Canada at different times, but if we talk about recent large-scale events, COVID-19 has certainly made its contribution here. Lockdowns that locked people in their homes have provoked a surge of interest in online services, including online casinos. Gamblers appreciated the opportunity to find themselves in an atmosphere of excitement and unforgettable emotions without leaving their homes. But historically, the situation has not always been favorable to the gambling industry.
The History and State of Gambling Laws in Canada
The 20th century: 70s – 90s
Gambling laws in Canada back in the last century were uncommonly harsher. Only over time, small indulgences appeared in the form of drawings and lotteries for charitable purposes, which were intended, rather, to slightly entertain visitors to exhibitions and fairs, and not to develop into an independent entertainment network. And Canadians eager for excitement would have been forced to be content with such a “scope” of legal gambling games, if not for innovations in legislation.
At the very end of the 70s, the provincial authorities received the right to organize lotteries with special exceptions under the auspices of charity, and in the mid-90s – the right to regulate gambling that were available not only “on the tables”, but also virtually: on computers and slot machines.
The 21st century: 2000s
In the meantime, the use of the internet was gaining momentum, and with it the opportunity to play online casinos. However, Canadians got online gambling legal access only at the end of the 2000s, when the provinces legally gained the right to regulate this area. At that time, there was not such a variety of online casinos as there is now, since Canada didn’t license anyone for online gambling, except for state-owned casinos in certain provinces. British Columbia led the way, then Quebec, and then Manitoba.
The reason for such indulgence in relation to gambling and online gambling was the income that gambling organizations were able to earn for the needs of the provinces. We are talking about supporting cultural programs and various social initiatives, as well as contributions to healthcare and the education system. Before legalization, Canadians gambling-lovers used offshore online casinos, and money that could be spent on the development of the country flowed out of Canada. Licensing of state-owned casinos allowed gambling tax revenues to go back on track.
The 21st century: 2010s
Using offshore online casinos, Canadians didn’t violate the laws for online gambling, since there was no corresponding ban. True, in 2016, Quebec legislators implemented Law 74, according to which internet providers had to block those Canadians who want to enter an offshore online casino.
But the provincial supreme court found that such a law was unconstitutional, as it violated provincial powers and several important laws, and overturned it.
The 21st century: 2020s
Then events took place that made certain for Canadians the issue of the legality of online casinos in Canada. In 2021, the Canadian government legalized betting on selected events. Certain provinces have offered legitimate online gambling services, but so far there has been no talk of registering overseas companies.
However, in 2022, the province of Ontario pioneered the legalization of iGaming and allowed many well-known brands of operators and game providers to operate in the province. The purpose of these innovations is in cooperation with law enforcement and the elimination of all unregulated gambling activities in Ontario.
This could be good news for all Canadians, not just people from Ontario, but by Canadian online gambling laws in Canada, games can only be played across provincial borders with a special agreement between provincial governments.
Legality of online casinos in the provinces
There are ten provinces and three territories in Canada, each of which has a certain position regarding online gambling entertainment.
It has the only legitimate online casino with the domain name www.playalberta.ca. Player age 18+.
In this province, it is allowed to play if the player has reached the age of 19 years. At the moment, there is only one legit online casino with the domain name www.playnow.com.
In Manitoba, the situation that is typical for most Canadian provinces will continue: Canadians can only play in online casinos licensed by the authorities, but there is no law prohibiting playing on foreign casino sites. Player age 18+.
In this province, players aged 19+ are also required to play only at licensed local casinos, and if they choose to visit a foreign online casino or online bookmaker, they must first find out if the foreign online organization of their choice advertises their services in Canada. If so, then it is not allowed to play in such a casino.
Newfoundland and Labrador
This province ensures that gamblers aged 19+ only play at online casinos regulated by the Atlantic Lottery Corporation (ALC). Sports betting is only allowed on www.alc.ca/content/proline-stadium/en.html.
Here, too, ALC plays an important role: any games offered by the corporation are legal. There is no ban on playing in foreign online casinos. Players must be 19+ years old.
A pioneer province in strengthening iGaming in Canada. The provincial market has opened to foreign online casinos and all services of foreign gambling brands are being licensed.
Prince Edward Island
The situation is familiar to the Great White North: gambling is regulated by the ALC, while foreign online casinos are not prohibited. The age of the players is 19+.
The legal age of gamblers is 18+. The only legal site is www.espacejeux.com, and for sports betting there is a Mise-O-Jeu bookmaker with an app of the same name for smartphones and tablets. Foreign gambling sites are not prohibited by law for gambling.
Everything is the same: foreign online casinos are not prohibited. From local sites, gamblers have access to sportselect.com. The player must be over 19 years of age.
Northwest Territories, Nunavut, Yukon
There are too few residents in these territories to organize full-fledged local online casinos, so local Canadians play on foreign sites.
Foreign online casinos vs. legalized ones in Canada
Any Canadian will be happy to use the services of a local legal online casino, if only for reasons of patriotism. But the fact is that there are few such online casinos in Canada, and therefore Canadians are forced to turn to foreign online operators. Another reason that encourages Canadians to visit foreign online casinos is that a large range of foreign operators generates competition, which in turn forces operators to offer visitors the most profitable promotional offers.
In addition to casino bonuses, Canadians are attracted by the opportunity to bet in hybrid or crypto casinos. Unlike traditional online casinos, these operators use software based on blockchain technology. Hybrid foreign casinos are gaining great popularity today, as they accept not only fiat, but also cryptocurrencies for bets.
The advantage of a legal Canadian online casino can be a large number of payment methods that are common in Canada, because offshore operators often come across only a few payment offers available to Canadians. And if we take into account the fact that often the payment method for depositing funds and the payment method for withdrawing funds may not coincide, this creates inconvenience.
For example, a foreign operator offers among the payment methods popular among Canadians Interac. But it turns out to be available only for depositing funds, and for withdrawal it’s already proposed to use another payment method. On the one hand, this can be explained by the fact that a foreign operator selects payment methods for a large number of countries and cannot always take into account the preferences of all. On the other hand, this is a dishonest attitude towards customers and a good reason for Canadians to use the services of local online casinos.
Important facts about foreign online casinos in Canada
Canadians are not in a legally vulnerable position when playing at foreign online casinos. This applies to both those gamblers who play from time to time, and those who are regulars at online casinos. If an online casino is located in Canada but doesn’t have a gaming license, it is carrying out illegal gaming activities.
No online casino winnings (whether foreign or Canadian operators) are tax-free, with the exception of winnings from gamblers whose gambling activity is a form of income (skill, frequency of play and frequency of winnings are taken into account here).
The future of online gambling legal in Canada
Until now, Canadian players have been forced to look for a variety of online games from foreign operators, as local operators did not satisfy all requests. The Canadian authorities paid little attention to the field of virtual gambling, having missed the financial strategies that were beneficial for the country. The opening of local online casinos will help strengthen Canadian operators in the local market. The legalization of online casinos in Ontario resonated with local residents, because despite the large range of foreign operators, local ones still enjoy great confidence among the players. One can only hope that other provinces won’t hesitate for a long time, but will support Ontario’s initiative.
Why does Canada need online gambling?
According to statistics, Canadians (as well as residents of other countries) today prefer smartphones as a means of quick access to the internet, as well as convenient use of various services, from online shopping to online casinos. Due to the lack of legal Canadian online casinos, local gamblers are forced to play on foreign sites that are not accountable to the Canadian authorities in any way (including financially). There is a leakage of funds from Canada, which could go to various social needs of the country. A legalized virtual casino will be able to contribute financially to the Canadian economy, as revenues will not be lost due to inconsistent gambling regulations.
Do online casino players pay tax on their winnings?
By law in Canada, winnings are not taxed unless the gambler is a professional player and doesn’t profit from the game. The tax is paid only if winning in a casino for a gambler is a form of income.
Whereas winnings in the United States from casino gambling are taxable at a rate of around 24% according to USA-Casino.com.
How not to get into a fraudulent online casino?
The main difference between a scam casino and a legitimate casino is that a scam casino doesn’t have a license. If we are talking about a Canadian online casino, then at the moment there are not so many licensed Canadian casinos and you will not get lost among them. If we are talking about a foreign online casino (of which there are a lot), then it’s necessary to check the info about the availability of a license on the website of this online casino before registering.
Is it legal to play online casino in Canada?
If we are talking about a local online casino, then it must be licensed by the regulatory Canadian authorities. Canadian online casinos without a license are illegal. If we are talking about a foreign online casino that does not have a license in Canada, then its services can be used if this casino does not advertise its services in Canada. There is no law that prohibits Canadians from playing on foreign casino operator sites.
Can gamblers play for free at online casinos?
Yes, game providers provide operators with demo versions of games, when playing in which the gambler doesn’t bet for real money. These games help a player test their strategy or try a new game they like.