Quebec Considering Recommendations to License Offshore Gambling Sites

Loto-Quebec

It has taken four years, but the independent commission tasked with analyzing the Quebec online gambling market has presented its 200-page report.

With University of Montreal professor Louise Nadeau at the helm, the commission that began its work back in 2010 offers some positive findings and makes precedent-setting suggestions for the online gambling market in the province.

Their job was to assess the impact of Espacejeux, the government's regulated and licensed online gambling site, just like PlayNow in Manitoba and B.C. The site also offers a poker room that operates on the GTECH-powered Canadian Poker Network. The independent commission set out to discover what changes the launch of Espacejeux would bring to problem gambling, government revenue, and harbouring the activity of unlicensed offshore competition like bet365, PokerStars, 888poker, etc.

The report suggests that it would be most beneficial if the provincial government were to allow carefully-scrutinized private operators to enter the market in a legal, licensed way.

This is a stance shared by the Interactive Gaming Council (IGC). The IGC believes that the Canadian government should make provision for offshore operators and allow them to operate in the Canadian market legally in a licensed and regulated manner, rather than the grey area they currently exist in as they continue to take gambling revenue out of the country.

"The IGC believes that well-regulated online gaming in Canada will accomplish three key things: provide legal clarity for Canadian players and online gaming companies with Canadian customers; harmonize standards with other leading jurisdictions to enhance consumer protection; and provide additional tax revenue opportunities for governments.

The reality is that vast numbers of Canadians are already playing on online gaming sites and deserve the full protection of their governments."

This recommendation is in line with news that came out early this summer that Loto-Quebec, the provincial regulatory body for the province, was looking in to the possibility of issuing licenses to sites like Full Tilt and PokerStars now that they are under Canadian ownership with the Amaya Gaming acquisition.

The report also acknowledged that this course of action would require changes to the national Criminal Code, which would likely be a very long process taking years to implement. A temporary solution offered by the commission was that the provincial government could allow access to private operators through a government-operated portal — a strictly controlled website that Quebecoise could use to legally access offshore gambling sites.

Not surprisingly, the commission found that the presence of Espacejeux in the province made no significant changes to the amount of gambling done in Quebec. Many critics oppose the government-operated gambling sites in Quebec, Manitoba, and B.C., claiming that they will lead to an influx of gambling and gambling addiction. The team of researchers found that public participation in gambling was up barely 0.1% two years after Espacejeux's launch.

The commission also estimated that there are 95,000 online gamblers in the province, but only 18,000 of them are using Espacejeux. Licensing, regulating, and taxing international operators would allow the government to collect revenue from all 95,000 of those players, rather than the much smaller portion who play on the government site.

The report also suggests some tough responses to the current state of the market. It recommends that the province should inform unlicensed operators of their legal status and suggest they withdraw from the Quebec market, impose penalties and even ISP blocking of those that do not comply, put pressure on software providers and other suppliers so that they also encourage operators to leave the market, and take steps towards the formation of an online gambling policing authority.

The report has been presented to the provincial government, and Minister of Finance Carlos Leitao has asked Loto-Quebec to take a close look at the findings and respond with a plan of how to proceed in implementing the recommendations.

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