Online Gambling Creates Legal Gray Area For Canada

Canadian Flag In the almost two decades since online gambling has become popular, Canada’s legal system has found itself somewhat lacking. Several Canadian media outlets have called it a legal “grey area” when trying to understand Canadian legislature as it pertains to online gambling. The issue where we find the legal code gets ‘hooked’ up on is the Internet. These codes were written before the Internet was conceived and therefore don’t explicitly include mention of it or even imagine the effect that online technology would have on world communication. Canadian online gambling was not foreseen. It’s also been said in popular media that as of late, Canadian law enforcement seems to be preoccupied with more dangerous threats like national security, drug problems, and biker gangs. Seems understandable.

Chad Finkelstein, a gaming law expert interviewed by cbc.ca mentioned the outdated criminal codes. "The criminal code was written decades ago, and these provisions with respect to gaming were drafted in the 1960s and haven't really been updated since. These provisions were not drafted with anything remotely resembling the internet ever contemplated. So, we have outdated, antiquated provisions, which makes it difficult to apply to a modern gaming business."

In Canadian gambling laws and regulation is left up to the individual provinces to determine whether should be legal and in what forms it should allowed or banned. However, the Internet doesn’t concern itself with provincial boundaries and this is where the legalities start to get blurred. There are thousands of off-shore gambling websites that are located all over the world in places where governments gladly welcome the revenue from taxes. These places court the citizens in other countries of the world where gambling is largely illegal or problematic and skate through these legal “grey areas” by being located off shore and in legally defined jurisdictions.

Cbc.ca interviewed another gaming law expert, Michael Lipton, in Toronto about the legalities of placing bets online with off-shore sportsbooks. "As far as I'm concerned, you as a player aren't committing any criminal offence by being in a position where you are engaged with an offshore operator playing poker, playing slots, or whatever the case may be," said Lipton. He continued to explain, "There have been no prosecutions that resulted in convictions or guilty pleas, so the offshore sports books look at Canada as a grey zone,".

Although Canadian authorities don’t really do anything about online betting and let Canadian bookmakers and customers operate relatively freely, Lipton believes there is still a clear violation of criminal code. When you focus on the owners and operators of these off-shore sites instead of their customers, the question shifts. It becomes whether its legal for them to even have Canadian customers.

According to Lipton on cbc.ca, on other issues, foreign business owners that have maintained a considerable connection to Canada in some way can be found to be violating the Canadian law. He continues to explain that if a foreign entrepreneur conducts business in Canada, advertises there, and enters into contracts and knowingly accepts bets from Canadians, that would be enough to prove a considerable connection and at which point, places them under Canadian jurisdiction.

Canada has never made a single arrest on this matter.