The Canadian government introduced the 2014 federal budget on February 11 with few expectations of any noteworthy commitments. While there were indeed very little commitments that stood out, one portion of the budget will severely impact Canada’s online gambling sector.
In the House of Commons, Finance Minister Jim Flaherty said the government will introduce commitments that will “make online casinos subject to the Proceeds of Crime and Terrorist Financing Act (PCTFA).” According to the government, these new amendments will “strengthen Canada’s anti-money laundering and anti-terrorist financing regime.”
Under Canadian gambling law, casinos must comply with strict recordkeeping policies, including alerting authoritative regulators to any suspicious persons or transactions within the casino. However, the government argues the law is outdated, and does not enforce online casinos to follow the same rigorous recordkeeping procedures.
Flaherty did not make clear in his speech what types of online gambling domains will be targeted for stricter compliance with PCTFA. It makes sense that online casinos powered by Canadian provincial gambling and lottery corporations would be forced to comply with the new amendments. But the government must clarify if internationally licensed online casinos are required to adjust how they report their operations to avoid violating Canadian gambling laws.
Some gaming critics wonder if the government is deliberately adding bureaucratic costs to operate online gambling sites in Canada to drive out competition. Canadian lottery corporations, led by the BCLC, are launching their own licensed online casinos that compete with more established international gambling domains.
The complex legality of Canada’s online gambling sector has led to complications in the past, with some casinos and payment processors choosing to withdraw from the market entirely. Redefining the laws with tougher regulatory and legal costs could be considered by some operators as Ottawa’s attempt to turn away international online casinos.
The announcement in the budget was merely an offering of what the government has in store, and any thoughts on how the proposal will change Canada’s online gambling sector is merely speculative. The details of how the changes are implemented will be revealed in time, which should help clarify the future of online gambling in Canada.
