Ontario Sports Betting Regulations Prohibit Promotional Advertising

Ontario is only a few weeks away from its entry into legal commercial iGaming and mobile sports betting. But unlike in the US where sportsbooks and internet casinos flood new markets with marketing promos targeting potential players with an array of signup incentives, regulations in Canada’s largest province prohibit such advertising.

An advertisement from DraftKings running in Ontario is absent of free promotional incentives, as required in the Canadian province. Casinos are worried that they emergence of iGaming and mobile sports betting will hurt its brick-and-mortar businesses. (Image: DraftKings)
An advertisement from DraftKings running in Ontario is absent of free promotional incentives, as required in the Canadian province. Casinos are worried that they emergence of iGaming and mobile sports betting will hurt its brick-and-mortar businesses. (Image: DraftKings)

Ontario’s Legislative Assembly last July passed legislation to authorize internet casino sites featuring interactive slots and table games, plus online sportsbooks. The motion came after the Canadian Parliament legalized single-game sports betting.

Just a month after Ontario lawmakers decided to bring offshore iGaming activity into a legal, regulated market, the Alcohol and Gaming Commission of Ontario (AGCO) announced it would ban iGaming firms from marketing promotional gambling incentives to lure in patrons.

However, Ontario residents wishing to gamble online will still be afforded many of the same lucrative signup deposit matches and risk-free first bets. AGCO officials say iGaming firms like DraftKings can still offer such promos, but only on their actual websites.

Ontario is set to become the first Canadian province to allow gamblers to lawfully bet online when the first commercial internet sites go live on April 4.

Great Canadian Has Great Concerns

Ontario’s 28 brick-and-mortar casinos have expressed worries that the legalization of iGaming and mobile sports betting will result in a steep decline in land-based gaming.

Great Canadian Gaming (GCG), Canada’s largest casino operator that runs 14 casinos in Ontario, believes iGaming will result in a mass exodus of play to online platforms.

Through a commissioned study on the fiscal impacts of legal online gambling, GCG warned the Ontario government that it should expect CA$550 million (US$432 million) less tax money each year from land-based gaming revenue. GCG also contends that iGaming could eliminate one in four jobs in the retail gaming sector.

Great Canadian and leaders at Unifor, the largest union in Canada, specifically take issue with Ontario levying only a 20 percent tax on iGaming revenue while land-based casinos are taxed at an effective rate of 55 percent.

We are looking at significant job losses and unfair playing field,” Chris MacDonald, assistant to Unifor President Jerry Dias and responsible for the union’s gaming division, told the Windsor Star. “[iGaming] will have a significant impact on current operations, union jobs, and revenues.”

Unifor has the support of the Ontario Chamber of Commerce regarding the iGaming arrival and associated tax levy. The entities recently wrote Ontario Attorney General Doug Downey to express their worries that the expanded gaming “may come at the expense of current revenue and employment sources our communities depend on.”

iGaming Already Robust

The other side of the iGaming liberalization debate argues that Ontarians have long been gambling online. Licensing such internet gaming firms, they argue, is simply a way to rid the grey market and generate new tax revenue.

“People who are playing in online casinos and online sportsbooks and online poker rooms will continue to do so, except they’re going to go from playing offshore to onshore,” said Jeffrey Haas, senior vice president of DraftKings.

“Anybody who continues to walk into real casinos in order to play games there will continue to do so,” Haas concluded.

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