Introduction

In August 2021, regulated single-game sports wagering was launched in Canada [1, 2]. Sports betting had previously been available to residents of Canada via a parlay wagering product offered by provincial lottery operators (requiring bettors to select multiple games correctly in order to win) or via an extensive gray market. The significant change to sports gambling in Canada arrived via Bill C-218 which was passed by Canadian Parliament to permit the amendment of the Criminal Code, allowing wagering on single sports events [3]. The rollout of the new legal market has been rapid, despite Canada being slower to legalize single-game betting in comparison to much of the United States, which has seen more than 35 states legalize sports betting in the wake of a 2018 U.S. Supreme Court decision giving states the option to legalize the activity [4]. Two years since launching, the sports gambling landscape in Canada has evolved dramatically. Both Canada and the United States are late arrivals to offering regulated single-game sports wagering in comparison to other countries such as the UK and Australia, which have offered the activity for many years.

Since the 1980s, Canadians have had access to parlay-style wagering via provincial lottery operators; however, single-game betting had remained in a legal gray area or outright illegal depending on the rendition [5]. There has long been a perception that parlay wagering, which involves wagering on multiple events was less likely to lend itself to corruption, because of the challenge of an individual needing to influence multiple events. From a responsible gambling perspective, single-game wagering likely raises new concerns as the number of offerings has expanded from what was essentially a limited market under the previous multi-game model. Prior to the legalization of single-game wagering in Canada, such gambling occurred primarily via a robust gray market [1,2,3,4,5]. It was estimated that Canadians wagered $14 billion offshore annually in 2021 and the capacity to retrieve some taxes from this market helped motivate parliamentarians to amend gambling legislation [1].The legislative changes allowed provincial governments the power to permit and determine how single-game wagering would take place. According to an official summary, C-218:

[A]mends paragraph 207(4)‍(b) of the Criminal Code to make it lawful for the government of a province, or a person or entity licensed by the Lieutenant Governor in Council of that province, to conduct and manage a lottery scheme in the province that involves betting on a race (other than a horse race) or fight, or on a single sport event or athletic contest [3].

Legalized sports gambling in Canada has quickly emerged over the past 2 years with all provinces launching single-game gambling products through their provincial lotteries [6]. Ontario made the unique decision to bifurcate the market. Like all provinces, Ontario welcomed single-game betting through its lottery corporation but also allowed a competitive commercial market.The private market launched in Ontario in April 2022 [7,8,9]. Ontario also wiped clean the slate for any entities that previously operated in the gray market by allowing them to enter the regulated market without repercussions for past behavior [8, 9].

The Ontario context was deemed a “grand experiment” [10, 11••], and in its second year, there is an opportunity to survey preliminary results. The decision to bifurcate the Ontario market was made prior to the passage of C-218 and likely reflected a desire to capture money that was being wagered in the gray market, as well as the possibility that a competitive market could generate greater benefit for the province than a monopoly model [8,9,10,11••]. Moreover, it is 2 years since the passing of C-218 and this article offers a review of the evolved legal and regulated sports gambling landscape in Canada, with a particular focus on Ontario given its decision to experiment with allowing private entities into the Canadian marketplace. Extensive academic attention has been given to the legalization of sports wagering in the United States; however, much less consideration has been given to the emergence of legalized sports betting in Canada [11••]. Canada’s sports gambling market provides a unique context for the consideration of gambling legislation and its implications. In the subsequent discussion, Canada’s new sports wagering market will be described and rising concerns surrounding advertising and responsible gambling will be examined.

Canada’s New Market

The ability to offer single-game wagering has undoubtedly been a boon to provincial lottery operators who possess a monopoly on the market. On the other hand, Ontario’s experiment has seen a great amount of money wagered; however, the statistics released by the regulator, iGaming Ontario, have lacked the necessary detail to gain a full picture of the market. For much of the past 2 years, iGaming Ontario released reports, which did not separate sports wagering figures from online casino numbers, the latter of which is associated with significantly higher operating margins for wagering operators. Among the figures released by iGaming Ontario in the first year of operation (running April 4, 2022–March 31, 2023), Ontario’s regulated operators, excluding the province’s Ontario Lottery and Gaming Corporation’s products, generated $35.5 billion in total wagers, which translated into $1.4 billion in revenue. The market also saw 45 operators, and 76 different brands in the market which collectively held 1.65 million player accounts and translated to an average spend of $70 per month per player account [12]. The second year of the market has seen a slight drop in the number of operational websites, down to 71 from 76 [13]. In quarter two of 2023–2024 covering July 1–September 30, 2023, Ontario player accounts dropped to 943,000 (a drop of nearly 700,000), but the average monthly spend per account rose to $191. In the second year, the provincial regulator also introduced a more useful breakdown of numbers detailing that in quarter two Ontarians wagered $1.9 billion on sports, which translated to $118 million in revenue [13]. Ontario’s competitive market has appeared to outpace the revenue generated by British Columbia’s lottery corporation which saw $31.6 million in revenue in 2022–2023, and the Atlantic Lottery which generated $14.8 million in revenue from sports betting in 2021–2022 [14].

Following the private market launch in Ontario, a key question was whether there would be significant impact on the pre-existing gray market. Prominent gray market operators have benefited from Ontarian’s offshore gambling money for years and questions surrounded how many of these operators would enter Ontario’s new regulated market. Indeed, the experiment may be deemed an early success because most of the biggest former gray market operators have entered the regulated Ontario market bringing with them revenue that is now taxable. The Alcohol and Gaming Commission of Ontario (AGCO) reported at an early stage that of 36 operators in the provincial market, 28 of these previously operated in the gray market [15]. A transition period was provided for unregulated operators and ended in October 2022 [16].

One of the controversial aspects of the launch of a regulated market with private operator participation in Ontario was the decision to classify pay-to-play fantasy sports alongside other gambling activities and require site operators to go through a similar process to sports wagering operators [17]. Daily fantasy sports companies had spent years lobbying in the U.S. that their products were distinct from prohibited types of betting with fairly significant success [18,19,20]; however, past efforts did not convince Ontario regulators that paid fantasy sports could exist in a separate universe from sports wagering operators in the province. The decision by Ontario regulators led many popular daily fantasy sports providers to shut down operations for those located in Ontario. This included FanDuel and DraftKings who opted to be licensed as sports wagering operators, but elected to cease daily fantasy operations in the province, [21] though many daily fantasy sports companies appear to still be active in other provinces. While the regulations do not outlaw the contests or place burdens above those in other regulated jurisdictions, Ontario places restrictions on how operators pool prizes. Ontario’s restrictions mean that operators would effectively need to operate separate contests, or at least keep separate pools of prizes for those located in Ontario, something deemed economically impractical by many [22]. The fantasy sports guidelines are not the only aspect of the Ontario model that have received criticism from the gambling industry. One of the most frequently critiqued—and sources of regulatory violations [23, 24]—has been Ontario’s advertising guidelines.

Sports Gambling Advertising

When sports betting became legal across most parts of the United States, a rapid influx of sports gambling advertising followed [25]. The launch of Ontario’s private market drew questions as to whether Ontario’s advertising restrictions would stem any associated tide of sport gambling advertising. The Ontario advertising standards in place state: “Advertising and marketing materials that communicate gambling inducements, bonuses and credits are prohibited, except on an operator’s gaming site and through direct advertising and marketing, after receiving active player consent” [26]. These restrictions are distinct from what is permitted in the US and mean that consumers primarily learn about promotions by visiting each operator’s site or mobile application [11••]. In the early months of the private sports gambling market in Ontario, the AGCO issued monetary penalties to several operators for advertising and inducement infractions, including a $100,000 fine for DraftKings [27].

However, it quickly became apparent that the torrent of sports betting advertising in Ontario was inevitable. Sports gambling advertising soon dominated live sports broadcasts with commercials featuring celebrities such as the following: hockey legend, Wayne Gretzky; current NHL players, Connor McDavid and Auston Matthews; and actor, Aaron Paul [28]. Media reports suggested that the broadcast of one hockey game could include almost 9 min of sports gambling advertising [29]. So, while the restrictions limited the ability of consumers to discover promotions, the restrictions did not do much to abate the volume of advertising.

The avalanche of sports gambling commercials in Ontario evoked concern and criticism from consumer advocates, addiction experts, and the broader public [30]. While Ontario has received much of the focus, as it is a competitive market, gambling advertising concerns have been expressed across the country, as gambling advertising has become a common feature of sports broadcasts [30]. A central concern has been about the impact that these commercials have on children and vulnerable populations. Amidst mounting public pressure, AGCO moved to ban the use of active or retired athletes in the promotion of online gambling and to restrict the use of celebrities that appeal to children in these advertisements [26,27,28]. The tightened legislation comes into effect on February 28, 2024 [28]. Critics have suggested that the restrictions are a step in the right direction but contend that a stricter and more cohesive national standard is required [30].

Since the passing of Bill C-218, Canada has seen the rapid “gamblification” of sport, consistent with the embedment of gambling into sporting culture evidenced in other countries [31,32,33]. Around the globe, sports gambling advertising has attracted increased regulatory attention. Countries such as Italy and Belgium have banned sports betting advertising completely [34]. Germany and the Netherlands have recently tightened restrictions on gambling advertising with changes particularly aimed at protecting young people and at-risk groups [34]. In Australia, a parliamentary committee has recommended a phased, comprehensive ban on gambling advertising within 3 years [35]. Gambling advertising restrictions are consistent with public health research that indicates restrictions limiting exposure to advertising, particularly among children and vulnerable groups, should be included in harm prevention strategies [36••]. As sports gambling continues to grow in Canada, and with more provinces considering expanding to an open market with private operators, regulatory attention and public health concern will likely remain at the forefront.

Responsible Gambling

The expanded options for sports betting in Canada, along with the explosion of associated advertising, necessitate consideration of the impact on gambling-related harms and, moreover, responsible gambling interventions. Responsible gambling strategies are defined as “diverse strategies or regulations that contribute to minimizing negative personal and social impacts such as problem gambling” [37].Footnote 1 The need for adequate integration of responsible gambling strategies is notable given that existing research has highlighted that sports gambling is especially associated with elevated levels of problem gambling [38••].

Proponents of the regulated sports betting market in Canada have cited that the new market allows for the enforced implementation of responsible gambling standards [39]. AGCO’s Responsible Gaming standards provide a variety of requirements on operators including maintaining advertising standards that require individuals to opt-in to receive target advertising. Operators are also required to provide individuals with “meaningful and accurate information to enable them to make informed choices” [40]. IGaming operators in Ontario are also required to obtain responsible gambling accreditation as part of their licensing agreement [39], as well as monitor activity to provide “support” to individuals demonstrating potential problematic behavior [39]. Additionally, operators can be issued with monetary penalties for violations of AGCO’s responsible gambling standards [41]. For example, in August 2023, AGCO issued a $100,000 fine to Apollo Entertainment. The alleged violations included failing to conduct required interventions with players who may be experiencing gambling-related harms and failure to implement self-exclusion programs and provide tools to assist players to set financial and time-based gambling limits [41]. There is an opportunity for responsible gambling strategies to be embedded within the fabric of the new regulated gambling market. However, it has been argued that the advancement and utility of responsible gambling programming have not kept pace with the sports gambling surge [42, 43].

In 2022, Ontario’s Auditor General, Bonnie Lysyk, released a report on the operations of the Ontario Lottery and Gambling Corp (“OLG”) and raised concerns that despite significant growth in the customer base, the number of users accessing responsible gambling tools has decreased [43]. In the previous 5 years, OLG’s iGaming customer base increased from 31,000 to 257,000 average players per month; however, the percentage of betters using the player casino loss limits tool dropped from 33 to 11% of active players in June 2022 [43]. The Auditor General also noted that the OLG has decreased its financial investment in responsible gambling (from $CA20 million to $CA 7 million) over the same period and does not measure or report its progress on responsible gambling [43]. Inadequate investment in responsible gambling measures is of concern considering a recent systematic review indicates that responsible gambling programs have helped lessen risky betting behaviors [37].

The rise of regulated single-game sports gambling and accompanied introduction of novel forms of sports betting, such as in-play betting, are associated with increased risk of gambling-related harms [38••, 44••]. One of the few studies examining gambling in the Canadian context demonstrated that in-play betting was especially associated with increased severity of problem gambling, greater gambling-related harms, increased mental health, and substance use difficulties [44••]. Despite the observance of increased risk surrounding in-play wagering, Ontario’s standards only contain brief mention of in-play betting. Standard 2.8.1 details that “the method of making bets…must be straightforward and understandable,” while clarifying that the rule is “not intended to prohibit or preclude in-play betting” [40]. Overall, there remains opportunity for the expansion of Canada’s legalized sports betting market to be coupled with an emphasis on the implementation of responsible gambling approaches.

Conclusion

The legislative allowance of single-game sports wagering through an amendment to the Criminal Code of Canada brought an end to a near decade long effort to allow for the practice in a regulated form in Canada [45••]. Two years into legalized single-game wagering the market is beginning to take shape. While Ontario set out on a unique experiment allowing former gray market operators to enter the regulated market, so far, no other province has elected to forego its monopoly and allow private entities to compete. The market as a whole, however, remains incredibly young. As the market continues to mature, public health concern and regulatory attention will inevitably follow. Looking ahead, two key areas to observe will be gambling advertising legislation and responsible gambling investment and innovation. The consequences of the decision to allow single-game sports betting, and the expansion of iGaming have not fully materialized or at least been quantified. It is likely that after 5 years, trends will be clearer, and after 10 years, we will have a clearer view of the prudence of Ontario’s grand experiment.