The launch of Ontario’s new internet gambling market has provided players in the province with a host of legal wagering options — but betting on horse racing is not yet one of them.
Ontario sports betting received a shake-up on Monday when a regulated iGaming market launched, allowing private-sector operators of online sportsbooks and casinos to take action in the province.
The new market includes online sportsbooks that may have been previously taking bets in Ontario — including on horse racing — despite being regulated offshore or outside the province. Ontario’s government has said that provincial players were spending nearly $1 billion a year on online gambling and that an estimated 70% of that action was flowing to “grey market websites.”
Some bettors are now finding they can no longer wager on the “Sport of Kings” with bookmakers that have joined the province’s new iGaming market.
"It’s important to note that the regulated iGaming market framework in Ontario does not allow for horse racing at this time,” a spokesperson for the Alcohol and Gaming Commission of Ontario, the market’s regulator, told Covers earlier this week.
It's complicated
Ontarians can still legally bet on horse racing. The province has over a dozen physical racetracks, even more off-track betting facilities, and two apps offered by operator Woodbine Entertainment Group, HPIbet and Dark Horse Bets.
However, one place where you won’t find betting on horse racing right now is in the province’s new iGaming market. The reasons why appear to be a bit complicated.
Oversight of horse-race betting in Canada is done at the federal level of government, not provincial. The Canadian Pari-Mutuel Agency (CPMA) is the entity that regulates the wagering and, as its name suggests, that wagering is done within a pool-based model. Out of the betting pools come winning payouts, operator fees, and taxes.
The CPMA can issue betting permits and licenses to Canadian racetracks and OTBs associated with them — not the online sportsbooks now opening up shop in Ontario. The provinces, meanwhile, are involved in overseeing the operation of the sport itself, such as setting race dates and licensing the tracks.
"A race association may submit an application for a permit to the Executive Director of the CPMA for approval," the federal agency told Covers on Friday. "They may also request approval to bet on races run at other racetracks, both domestic and foreign, and to conduct betting at theatres and through accounts established with the racing association (i.e., 'Telephone Account Betting' and 'On-track Account Betting’)."
Registered and approved website operators must provide dollar-spend and time-limit setting tools and the ability to take a short-term break or to #selfexclude for a longer term. Learn more: https://t.co/adZiIdBIxt #PlayWithConfidence #responsiblegambling #safergambling pic.twitter.com/cr6oXAn2lB
— iGaming Ontario (@iGamingOntario) April 6, 2022
But Canada has been tweaking the rules for legal sports betting.
While Canadians have long been able to legally bet on single horse races using the federally-run pari-mutuel model, there was a longstanding prohibition for other sports. That ban came tumbling down last year after federal lawmakers passed a bill authorizing the provinces to offer single-game sports betting.
The bill that passed and became law, C-218, initially could have allowed the provinces to offer betting on a single horse race as well. This drew pushback from the horse-racing industry, which was concerned about bookmakers offering fixed-odds wagering on the sport, instead of the pari-mutuel betting that provides the sector with funding.
“If the provinces and territories were to offer and regulate betting on horse racing, it could take customers away from the racetrack operators, who currently are the only entities issued betting permits by the CPMA,” said Lisa Foss, the executive director of the CPMA, during a February 2021 House of Commons committee meeting. “This would put further pressure on the horse racing industry and the revenues base of the CPMA.”
C-218 was ultimately amended to remove horse racing from the bill and, as a result, from the menu of sports on which provincial governments could offer single-event wagering. Provincial government-owned entities such as Ontario Lottery and Gaming Corp. are now taking wagers on single games, but they haven't been taking bets on individual horse races.
Ontario’s iGaming framework also legally hinges on a new government agency that executes operating agreements with private companies. Those operators, some of which were previously offering horse-race betting to provincial residents, are no longer taking wagers on the sport in Ontario after signing contracts with the agency, which is called iGaming Ontario, and entering the new iGaming market.
"The Criminal Code only permits pari-mutuel betting in Canada on horse racing; any other type of betting on horse racing, including fixed-odds systems, is prohibited," the CPMA told Covers in an email on Friday.
A solution?
No brick-and-mortar sportsbooks have opened yet in Ontario, at racetracks or otherwise. There is, however, talk of finding a way to insert horse racing into Ontario’s iGaming framework.
Woodbine Entertainment currently holds the only CPMA-issued pari-mutuel betting license in Ontario. The permit allows the Toronto-based company to run the wagering for all of the province’s horse-racing tracks, as well as the gambling done via Ontario's OTBs, HPIbet, and Dark Horse Bets.
The racetrack operator would now like to see its network integrated into those of the province’s new online sportsbooks. Some of those bookmakers even have horse-racing backgrounds already.
Woodbine Entertainment CEO Jim Lawson said in an interview with Covers on Thursday that sports betting is going to “cannibalize” the horse-racing industry, which supports approximately 25,000 jobs in the province, the company says.
Protecting the industry drove the effort to remove horse racing from Bill C-218, and is now prompting not-for-profit-like Woodbine (which aims to support the sector) to seek a role in the iGaming market.
“If these sports-betting operators want to offer horse racing, they have to do it on a pari-mutuel basis, and the only place to get that is from Woodbine in Ontario,” Lawson said.
Woodbine doesn’t believe their participation would require any additional changes to federal law either, just for provincial authorities to adjust their interpretation of the law accordingly. Lawson said it would be more of a marketing and hosting arrangement, in which the operators are offering horse-race betting, but are really offering it for Woodbine.
There is interest from sportsbook operators, according to Lawson. He’s now hoping the change in attitude among regulators will come pretty swiftly, such as within the next month or two.
“We were left in the starting gate” on April 4, Lawson said. “I'm frustrated but I'm still hopeful that this is not a big leap of faith to get there.”
This story was updated to clarify the number of jobs supported by the horse-racing industry in Ontario and to add comments from the Canadian Pari-Mutuel Agency.
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