Canada Online Gambling Laws

Canadians using gambling services spend over $11.3 billion dollars every year. Canada is home to several premier gambling software developers such as Cryptologic, yet the legality of gambling in Canada remains rather ambiguous. Customers looking to play online poker, slots, table games or bingo have no need to fear about being detained for illegal activity. However, it is still advised that every prospective gambler in Canada understand the legislature pertaining to online gambling as best they can before placing any form of wager.

Criminal Code of Canada

Gambling of any sort was initially prohibited by the Canadian Criminal Code in 1892. It banned both profitable and charitable forms of gambling in all provinces of Canada. However, the gambling industry has greatly changed since then and so has the public’s perception of gambling. In 1969, the Canadian government took the first step towards relaxing the prohibition on gambling by exempting all forms of gambling done for charitable purposes only. The purpose of this exemption was to give provinces control over the creation of lotteries in order to fund social programs. The most significant use of this exemption was performed by the province of Quebec, who utilized provincial lotteries to fund the 1976 Montreal Summer Olympics.

Gambling Crown Corporations

Gambling crown corporations are designated entities established by the provincial government to regulate all gambling activity. The very first two were created in 1970 by the government of Quebec to regulate horse racing and lotteries. Other regions including Manitoba, Alberta, Saskatchewan and British Columbia quickly followed suit, creating their own corporations to supervise gambling. Now, every province has its own crown corporation that oversees all online gambling aspects including casino, poker and bingo wagering.

Gambling Rules Based on Provinces

The popularity of province-regulated lotteries has allowed every Canadian province to regulate gambling activity within their own territory. The overreaching status of online gambling, according to the Canadian government, is that it is still illegal. However, the difficulties of determining jurisdiction rights in modern day online gambling, where Canadian gamblers can play at offshore gambling sites, have forced the Canadian government to give each province the right to determine the legality of specific gambling formats.

Provinces Prohibiting Gambling

The 1985 amendment to the Canadian Criminal Code that allows certain forms of computerized gambling is the origin of online gambling legalization. The amendment gave each province the right to regulate slots games and other computerized forms of gambling. This also effectively gave the provinces the ability to regulate casino-style online games such as video poker, slots and table games.

Most Canadian provinces have taken advantage of the amendment by legalizing gambling activity on all casino-style gaming. This means that Canadian players are legally able to engage in slots, video poker, Blackjack and other common games found in established casino sites. However, residents of New Brunswick, Prince Edward Island, Newfoundland and Labrador will not be able to legally participate in common online casino-style gaming. These provinces have made it illegal under the Criminal Code of Canada.

Video Lottery Terminals

The provinces of Ontario and British Columbia do allow gambling on certain casino-style games but still prohibit the use of video lottery terminals. The 1985 amendment regarding computerized gambling makes a distinction between ordinary slot machines and video lottery terminals.

Slot machines are classified as having individual random number generators. Comparatively, video lottery terminals are defined as machines linked to a central computer that uses a random number generator to produce results that are similar to a virtual bingo game. Each lottery terminal that is part of a central computer network receives a randomized set of numbers.

The central computer uses its random number generator to draw a specific number that is relayed to each terminal. The terminal checks if the number drawn by the center computer corresponds to any of the numbers in their randomized set. The terminal will then perform a specific action that may improve or reduce the chances of the gambler receiving a payout.

Ontario and British Columbia do allow gamblers to play online slot machines but prohibit the use of video lottery terminals. Most Canadian gamblers do not have to worry because slots games are much more common compared to video lottery terminal systems.

Running a Gambling Service

The majority of Canadian provinces allow their residents to gamble at common casinos, sportsbooks and poker sites but do not allow their residents to actively operate a gambling service. The Canadian Criminal Code still makes it illegal to operate any form of common betting house – including an online gambling site. All provinces currently adhere to this prohibition.

However, this has not stopped the Khanawake reserve in Quebec from offering server space to online gambling sites. The Khanawake reserve has its own regulatory gaming commission that gives gambling sites the ability tap into the North American gambling population. The Khanawake reserve still falls under the jurisdiction of Quebec, where it is illegal to operate a gambling service. The reserve has yet to be charged by the provincial government and is a hub for many top gambling sites that cater to the North American market.

The legality of online gambling in Canada will likely remain ambiguous for decades to come. The ultimate bottom line for Canadian gamblers is that the legality of online gambling is regulated by each province. Most gamblers will be able to legally participate in online gambling but should check to make sure that the province in which they reside allows their preferred form of online gambling.