September 17, 2021

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Ontario Releases License Application Guide For Online Gambling

Ontario is making rapid progress on its path toward privatization of online gambling in the province. The latest step on that path is the Alcohol and Gaming Commission of Ontario (AGCO) releasing a guide last week, informing interested companies of how to register and apply for a license. However, it won’t be accepting those applications for a few weeks yet.

The AGCO’s Internet Gaming Operator Application Guide came out on Aug 18. The agency also said interested operators will additionally need to “enter into a commercial agreement” with the province’s “Conduct and Manage entity,” iGaming Ontario. iGaming Ontario is a subsidiary of AGCO.

A similar guide for suppliers is coming soon. AGCO has said it will begin accepting applications “in the coming weeks,” and expects to launch the market in December.

Making good on privatization promises

At the moment, Ontario has online casino gaming (though not poker) through the Ontario Lottery and Gaming (OLG) website. The Conservative government under Premier Doug Ford, after a period of toying with the idea, promised concrete steps toward privatizing Ontario iGaming in last year’s budget. It began making good on those promises this spring.

Operator licenses will cost $100,000 annually. Because operators will be contracting with OLG, there’s no tax per se. Rather, their contracts will include revenue sharing arrangements with the lottery, negotiated on a case-by-case basis.

The Application Guide came less than a week after the Registrar’s Standards for Internet Gaming. Those standards, released Aug 12, lay out the province’s expectations of licensed operators and suppliers, categorized into six risk themes.

No grudges against the gray market

Like many liberalized European markets, Ontario is allowing gray market operators the chance to obtain official authorization. For now.

The guide explained:

“The AGCO has developed a regulatory framework to ensure honesty and integrity for igaming in Ontario and to protect Ontario consumers while, at the same time, facilitating a business-like transition from unregulated to regulated igaming scheme that is fair for registrants. As part of this transition, the AGCO is committed to taking strong action to address any remaining unregulated Ontario market activity in partnership with law enforcement.”

Gray market operators will have to cease serving Ontario customers before making their applications. However, AGCO will forgive any prior activity in the province until the regulated market launches. Once that happens, any company still serving Ontarians without a license will be considered a black market operator. This will bar them from obtaining a license in future.

This is in stark contrast to the American model of going through a period of prohibition before creating a white market.

Who may apply for online casino and online poker in Ontario

Some prospective operators are being coy. Others are boldly declaring their interest in serving Canada’s most populous province, which also houses its most populous city – Toronto.

One of those more forthright suitors even bears the portmanteau of the 3 million-strong municipality and its paper of record – the Toronto Star. Torstar Corporation – which owns the paper – wants to offer “a made-in-Ontario online casino and sportsbook option,” sister site Play Canada reported in July.

Another is Mohegan Gaming and Entertainment. When it launched its iGaming arm, Mohegan Digital in June, it made its intentions of expanding into Ontario clear.

Speculation continues that leading US online gambling operators like BetMGM and DraftKings will put their hats and crowns in the ring.

However, a different Entain brand, PartyCasino, has been making appearances in ads on Canadian television sets. Entain owns half of BetMGM, along with the operator’s namesake – MGM Resorts International. Additionally, PartyCasino is affiliated with PartyPoker.

Canadians have been positively bombarded with ads for online casino companies, or rather their play money dot-net sites. Some of these would be unfamiliar names to an American gambler: Bet99, Jackpot City and Spin Casino round out the quadruple tease of companies engaged in heavy advertising.

Still, which of these companies ultimately become legal operators is an open question – at least, until AGCO begins processing applications.

Ontario Releases Online Gambling Licensing Details, Application Guide For Interested Operators