Article published on 13 January 2014

Will Canada Define Online Gambling Laws?

Canadian Provinces Introduce Regulated Online Casinos
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For some time now, Canada has been seen as one of the countries with more liberal gambling laws. While much gambling is accepted in Canada, the laws themselves are not so clearly defined, and it seems that this lack of clarity could cause gaming and gaming related companies to withdraw from the market. The question is, will Canada define its online gambling laws?

Canadian Gambling Law

It is unclear whether the Canadian government has any interest in defining the online gambling laws that put businesses in the position of operating in a somewhat grey legal area. Some providers would prefer to pull out of the market, rather than find themselves on the wrong side of the law at a later stage.

The laws at this stage do not allow companies to operate online gaming sites from within Canada. However, there is no prohibition against online casinos and online poker sites from operating within Canada if they are located offshore. In fact, there are foreign online casino operators that are physically located in the Kahnawake reserve. While Kahnawake is physically located just outside of Montreal, it is not legally considered to be governed by Canadian laws, and is in effect considered to be outside of Canada. Players who play in online casinos that are located in Kahnawake are certainly not breaking the law at this time. When it comes to businesses, however, their legal status falls in a somewhat more murky space.

Titan Casino and Skrill in Canada

Titan Casino had announced its withdrawal, and had been expected to pull out of Canada in the second half of December 2013. In the end, Titan Casino reversed its decision and chose to stay. However, Skrill, the online payment processor, did in fact withdraw from the Canadian market. The withdrawal will be complete by the end of this month.

The reason that Skrill gave for withdrawing from the Canadian market is that the company was recently accepted to operate in New Jersey. The New Jersey licenses are contingent on some strict rules, including that the company must operate from within the state of New Jersey. It seems, in order to be beyond reproach for the New Jersey gaming laws, that it is better that Skrill remove itself from an online gambling market where it is essentially operating under a grey legal status.

It is unclear what direction the online gambling laws will take in Canada since recently, provincial governments have been regulating and launching their own online gaming sites.

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