Top News

Scott Stinson: The new marijuana? Advocates say sports betting should be the latest sin to be legalized

 Conservative MP Kevin Waugh recently introduced a private-member’s bill in the House of Commons to legalize single-event sports betting in Canada.
Conservative MP Kevin Waugh recently introduced a private-member’s bill in the House of Commons to legalize single-event sports betting in Canada.

A prospective gambler in rural Ontario could download an app provided by the provincial lottery corporation and, within moments, be losing real money on a virtual slot machine on her phone. People can walk into casinos from Vancouver to Halifax and most points in between and gamble on all manner of games. You can sit at a bar in St. John’s and spend money on a video lottery terminal with one hand while cradling a beer with the other.

Long past the days when the legal gambling options in Canada were limited to lottery tickets and the odd wager on the ponies, there are now countless options available, all with the blessing of government authorities, up to and including placing bets on a combination of sporting events. And, if one was determined to wager on a single game, it does not require a difficult search. Online betting companies like Bodog and Bet 365, registered offshore in places like Malta and Gibraltar, take wagers from Canadian customers, as does Sports Interaction, which is based in Mohawk territory outside Montreal. Less public-facing options also still exist, including the local bookie and his hired muscle.

As another attempt to legalize single-event sports betting in Canada was kicked off with the introduction of a private-member’s bill in the House of Commons on Tuesday, the most compelling argument for why it should happen might also be the simplest one: because it is already happening anyway. That cat hasn’t just left the bag, it no longer even remembers what the bag looks like.

“Sports betting is already legal in Canada,” says Paul Burns, chief executive of the Canadian Gaming Association, who confesses to a bit of a Groundhog Day feeling now that the issue of single-even wagering is before Parliament again. The bill introduced on Tuesday by Kevin Waugh, a Conservative MP from Saskatchewan, and supported by Brian Masse, an NDP MP from Windsor, is just the latest attempt at dropping the single line from the Criminal Code that prohibits wagering on a single sporting event. In 2012, one such bill passed through the House but before it could become law it stalled in the Senate, and died when Parliament was dissolved before the 2015 election.

In the ensuing years, the United States Supreme Court struck down its prohibition on sports gambling, and 19 states have already moved to legalize wagering, with more on the way. Meanwhile, the grey market here has expanded, thanks in part to the presence of high-profile operations with mainstream media attention, and in part to the fact that North American sports leagues have dropped all pretence of opposition to gambling.

“The business hasn’t gotten smaller, it hasn’t gone away,” says Burns of a sports-betting grey market that is estimated to have reached billions of dollars annually, as Canadian authorities have done little to stop it. (Part of that is a matter of logistics: an RCMP arrest warrant would have little effect on an online operator based in, say, Antigua.) And so, single-event betting may still be illegal here, “but that hasn’t prevented Canadians from doing it,” Burns says.

Concerns about the illegal market have existed for years, though. The legalization push in the United States has created a new sense of urgency, as gaming advocates here say the Canadian industry will take a major hit as Vegas-style sportsbooks pop up in border cities and states where wagering is now fully legal.

Dave Cassidy, president of the Unifor local whose members work at the Windsor casino, said on Tuesday that casinos across the river in Detroit are poised to take bets next month on the NCAA men’s basketball tournament, which puts the Ontario operation at a competitive disadvantage. “We can’t afford not to take advantage of any opportunity to get this legalized and protect our jobs while growing the gaming sector in Windsor and across the country,” he said as Waugh’s bill was introduced.

If the example in the United States is any indication, there is plenty of money to be made. In New Jersey, which led the push for legalization and allows betting both at physical casinos and online, the public has placed more than US$6-billion worth of bets since it was legalized less than 20 months ago, which has meant more US$50-million in new betting-specific taxes. Mobile wagering, which includes bets placed via smartphone apps, is by far the biggest business, taking in more than 80 per cent of New Jersey’s profits last month, according to PlayNJ. Toronto-based theScore, makers of the popular app, is among those operating in the state, with a separate app called theScore Bet. A recent New York Times story described a scene in which passengers on a ferry crossing the Hudson River from Manhattan could be seen opening their betting apps as soon as the boat crossed the state line.

We’re obviously pro-gambling regulation. It protects consumers, and it protects the industry

Other states that have been more restrictive haven’t seen the explosion of the New Jersey example, but the growth is still steep. West Virginia reported approximately US$800,000 worth of online bets in August, a number that had grown to US$24.6-million for the month of January. With a population of about 1.8 million, that’s a little under 15 bucks per West Virginian. For a province the size of Ontario, public wagering at a similar rate would bring more than $200-million of revenues per month.

It is that kind of money that has the provinces pushing Ottawa to bring legislation that will ultimately match the changes forced by the United States’ top court. And it is that kind of money that has some in the gaming industry wondering what is taking so long. Jim Lawson is the president and chief executive of Woodbine Entertainment, which among other interests runs a large casino and horse-race track in Toronto’s west end. Woodbine sees itself as a natural home for a sportsbook, given that it already has gambling — and sports-related betting — taking place on its premises. Lawson points to the experience in New Jersey, where horse tracks like Monmouth Park were some of the first places to offer on-site single-sport wagering, as a path worth following. “It’s been a great model,” Lawson says, noting that even with the requirement that legal bets in that state return a significant amount to public coffers, the New Jersey-based sportsbooks have been able to remain competitive with offshore sites.

Lawson makes the comparison to the Trudeau government’s legalization of marijuana, which took a black-market product that had significant illegal sales and allowed the provinces to regulate and distribute it as they saw fit, as a result adding new revenues to their treasuries. It is a common argument from advocates of expanded gaming and, as Lawson notes, it would seem to have an easier path to implementation, since provinces already have gambling and sports-wagering regulatory regimes. “What is holding the federal government back?,” he asks. “We’re all kind of scratching our heads.”

(It is worth noting here that the case against gambling is not simply one of overzealous Fun Police. There are societal impacts, and some jurisdictions that have allowed unfettered sports wagering are now wrestling with the consequences. More on that tomorrow.)

But the argument for expanded licensing will likely have at least a few sympathetic ears in a government that recently did the same for cannabis. Yaniv Spielberg, chief strategy officer for Bragg Gaming Group, a Toronto-based company that provides gambling-related technology to companies around the globe, says “the world is moving toward regulation.” His firm is publicly traded on the TSX Venture exchange and does most of its business overseas, but he knows well that there are already operators in the Canadian marketplace.
“Are my friends betting online on the Raptors? Yes,” Spielberg says. “Is the government protecting them? No.” The argument that sports-wagering should be legalized to push out grey-market operators has been made for some time, although it first started to gain mainstream traction when Adam Silver, then recently elevated to the job of NBA commissioner, argued in a newspaper op-ed in 2014 that sports betting “should be brought out of the underground and into the sunlight where it can be appropriately monitored and regulated.” It was a surprising tack for someone in his job then, but North America’s pro leagues have evolved to become fine with the oversight that legalized gambling provides — and the opportunities for additional revenue that it brings.

“Look, we’re obviously pro-gambling regulation,” says Spielberg. “It protects consumers, and it protects the industry.”

The business hasn’t gotten smaller, it hasn’t gone away

Interestingly, it could even protect those companies that presently operate outside the bounds of Canadian law, because they see the value in a regulated industry. Chantal Cipriano, a gaming and regulatory lawyer with Dickinson Wright in Toronto, says that the size of a legalized betting market in Canada would outweigh the benefits that the grey-market sportsbooks enjoy today with limited competition and no legal oversight. Regulation would bring hurdles, but such a market “is big enough that they would do it,” Cipriano says.

This, then, is the environment in which Canada’s Parliament considers another attempt to change the laws on sports betting: Its big neighbour has already done it, and those agitating for similar action here include provincial governments, municipalities, trade unions, the gaming industry both legal and illegal and even the sports leagues themselves. It is a veritable chorus of support. We are about to find out what lawmakers in Ottawa are hearing.

• Email: sstinson@postmedia.com | Twitter:

Copyright Postmedia Network Inc., 2020

Recent Stories