Loto Quebec Considers Entering into License Agreements with Poker Sites, Particularly PokerStars

Loto-Quebec, the government Crown Corporation and owner of the province’s only legally recognized online gambling site “Espace-Jeux.com”, is seeking ways with which to open avenues for PokerStar’s legal entry into Canada’s second largest province; but without drawing the ire of the local officials and violating the provisions of the Canadian Criminal Code.

One such possible means being explored is the offering of contractual license deals to international poker operators, in exchange for fees and share of the profits.

Loto-Quebec’s Espace-Jeux has the distinction of being the only regulated online gambling site in the province, but it does not have the same magnitude of patronage being enjoyed by the non-Quebec licensed online poker operators.

Accordingly, Espace-Jeux’s reported income of CA$26 million during the 12-month period ending March 31, 2014, is an improvement by at least 11 percent, when compared to its previous years’ performance. Yet if the amount is compared against the revenue generated by international poker sites deemed as illegally operating in the province of Quebec, which includes PokerStars, the latest turnover from Espace-Jeux’s online gambling operations is merely a drop in the bucket.

The information about the planned contractual licensing agreements was provided by Loto-Quebec spokesperson Marie-Claude Rivet. She added that Loto-Quebec has had preliminary discussions with the Quebec-based international iGaming company Amaya Gaming Group, being the new owners of the PokerStars online poker website. After all, Amaya’s foundation is deeply rooted in Montreal, and the company continues to maintain headquarters in Quebec’s largest city. Moreover, the phenomenal Canadian company has business ties with Loto-Quebec, being the crown corporation’s main supplier of gaming technology and online content to Espace-Jeux.com, as well as supplier of gaming machines to Loto-Quebec’s terrestrial casinos.

However, Ms. Rivet gave caution that the discussions with Amaya “are not advanced” as there are yet no clear plans whether the Quebec-owned lottery corporation will simply let the Canadian gambling firm add the PokerStars brand to Espace-Jeux.com; or for the crown corporation to enter into a player pool sharing agreement between Espace-Jeux.com and Amaya’s newly acquired Rational Group-owned online poker websites.

As of the moment, the Quebec-owned lottery corporation is still looking into all possibilities, including that of granting contractual license agreements with non-Quebec licensed poker operators. The main concern is for the government-owned lottery corporation to take strategic business steps without violating the Canadian Criminal Code.

In 1969, the Quebec provincial government passed the so-called “Act Respecting the Societe des Loteries du Quebec”, which entailed the creation of a company with the same name including a provision that designates the alternative name Loto-Quebec. The corporation serves as the lone authorized provider of lottery games in the province, and was likewise granted the authority to operate casino businesses in behalf of the provincial government. The company’s mandate is to perform actions that are necessary in order to attain its objectives but subject to prior approval of the Quebec government.

Such actions include :

Entering into agreements with another government and its agencies;

Acquiring, holding or alienating interest in any undertaking;

Contracting loans for the temporary purpose of attaining liquidity;

Enter into contracts that are binding up to 5 years;

Acquire or dispose immovable assets at amounts determined by the government

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