Appeals Court Judges Consider Fundamental Changes to Ontario DFS Rules

Posted on: December 5, 2024, 07:57h. 

Last updated on: December 5, 2024, 10:33h.

Mark Keast Read More

Expertise: Canadian Gaming, iGaming, Las Vegas, Sports Betting, NFL, Boxing, UFC.

A decision that could fundamentally change the free and paid daily fantasy sports and online poker scene in Ontario is now in the hands of five appeals court judges.

Decision Could Take Months

Canadian Gaming Association (CGA) President and CEO Paul Burns, who was on hand last week for the Ontario Court of Appeal proceedings, said a decision around allowing Ontario-based gamblers to play peer-to-peer games (free and paid daily fantasy sports and online poker tournaments) against players outside the province without violating the Criminal Code could take months.

Gambling sites licensed by the Alcohol and Gaming Commission of Ontario (AGCO) can only take wagers from people in Ontario.

When the province’s open, regulated market went live in April 2022, operators had the choice of building Ontario-only DFS platforms or shutting them down. Operators like DraftKings and FanDuel, which are both now licensed in Ontario, decided to close daily fantasy contests in the province.

Legal Arguments at Court of Appeals

The CGA, represented in court last week by McCarthy Tetrault’s Adam Goldenberg, stood with counsels representing the Ontario Attorney General’s office, as well as those representing iGaming operators, arguing to allow for Ontario players to connect with those outside the province.

Goldenberg’s position would provide the provincial regulator with oversight of international games in coordination with the corresponding jurisdiction regulator.

Lawyers for the Canadian Lottery Coalition (CLC) and the Mohawk Council of Kahnawà:ke (MCK) argued against allowing this position. The arguments boiled down to what does and doesn’t constitute international play, and the legality of that based on the Criminal Code.

Changes Coming for Ontario Market

“Talking about the nuances and intricacies of a section of the Criminal Code, it made for an interesting three days,” Burns said. “We were trying to keep things from the CGA perspective very simple in terms of approach, that what Ontario is proposing is legal, because Ontario will continue to regulate the activities taking place in the province, and that the Ontario customers would never leave the conduct managed regime of iGaming Ontario.”

iGaming Ontario (iGO) works with the AGCO and the provincial government to regulate the igaming industry, protect consumers in areas like responsible gambling, and provide more digital gaming choices. It was announced just a few weeks back that the status of iGO is being changed – it will no longer be a subsidiary of AGCO — and the new iGaming Ontario Act to be proclaimed in 2025 makes iGO an independent agency, further distancing it from the provincial lottery corporation.

Offering Liquidity for Online DFS and Poker

“It was quite interesting, because at the same time you’re talking about the law, you’re also trying to educate the justices on how the iGaming industry works, so doing two things at the same time, and that was the challenge for the lawyers,” Burns said.

The court will now go away and review evidence and write a decision, which could take up to six months because of a court backlog.

It may be some time before a decision of the Court is available,” added a spokesperson for the appeal court.

Said Burns: “I think that the understanding that players in Ontario will always be governed by the rules of play and the regulatory standards, and they never leave that in (an international) liquidity pool. I think the court understood that, and how it works, so that was important.”