Alberta’s Oct. 13 Deadline Puts Offshore Gambling in Focus

Key Points

• 4 days left for offshore gambling operators to decide if Alberta is serious. The three-month grace period comes to an end on 13 October and then the province starts to crack down.
• On the cards next are cease and desist letters, putting pressure on the payment processors and also going after Google, Apple and the social media platforms for hosting unlicensed gambling apps and advertising.
• But here’s the thing: Alberta’s not saying which step will come first, and it’s that uncertainty that might just be the most telling part of the story.

Offshore sites have now got less than a week to figure out if Alberta is up for a fight. On October 13, the province brought the curtain down on its three-month free pass for unlicensed operators. After that point, says Dale Nally, Minister of Service Alberta and Red Tape Reduction, the government is going to take action against sites that are still raking in bets without a licence.

Nally dropped that bombshell at the Global Gaming Expo in Las Vegas on Sept. 29, telling Canadian Gaming Business that Alberta would go after every possible option.

“We have some pretty interesting tools at our disposal that we haven’t tried out before”, Nally said.

What happens After October 13?

Alberta opened up its regulated online betting market on 13 July, but held back on enforcement for three months, a generous window for established operators to either get with the program or get out of town.

Those on board were given a three-month window to get all their affairs in order and register with Alberta Gaming, Liquor and Cannabis (AGLC) or pack up and leave. In that time the government kept its powder dry, but that all changed on Oct. 13.

Which Enforcement Measures Is Alberta Considering?

It’s all been laid out. Nally named three different ways the province will put the squeeze on unlicensed sites. Each one targets a different area of how these offshore sites reach Albertan players.

• Cease and Desist Letters

This is the most well-known of the options and a number of US States use this tactic already. The real test of its power though comes when a site refuses to listen.

• Payment Processors

Nally described this option, alongside cease and desist letters, as two other levers the province will be using to exert pressure on unlicensed gambling sites. But this time instead of directly chasing the sites, they’re going to go after the companies that handle money flow between players and the site.

• Google, Apple and Social Media

The third option is less well travelled in Canada, but Nally suggests app stores and social media companies could also find themselves on the receiving end of some serious pressure to stop allowing unlicensed gambling apps and advertising on their platforms.

How Many Regulated Sites Are Now Up and Running?

Alberta’s regulators are working hard on their enforcement plan, even as the provincial gaming market just keeps on growing. Alberta’s market kicked off on 13 July, with 18 operators launching 22 websites. That included household names like bet365, BetMGM, DraftKings, FanDuel and theScore Bet.

Some well-known players were noticeably absent on day one, though. Bet99, 888, PointsBet and Skill On Net (the outfit behind PlayOJO) were among the holdouts. By the time the provincial government issued its latest update on 14 September, there were 31 regulated sites in operation. But Nally is now predicting 60 sites will be up and running by the deadline though that’s not a guarantee, mind.

That 60-site figure is a prediction, not a hard and fast number. Just recently, for instance, Super Group’s Betway jumped into the regulated market and that’s a big deal, because the brand was already operating in Alberta before regulation came in. Another recent newcomer is PowerPlay, which launched its online sportsbook on 1 October after getting the necessary go-ahead from the provincial authorities.

Not every operator is happy to hang around, though. Regulators are saying that some brands that were already active in the province have told the commission they’re offski instead of applying for a license. Nally thinks the market could eventually support as many as 70 operator sites.

If you’re eager to make sure a site is legit, you can check the AiGC list of registered sites. The corporation is telling people that any operator that’s not on that list is operating outside the law.

Why Is the Government So Keen to Get Players Onshore?

The size of the offshore market is a big part of the reason the government is moving on this. Before the launch, Alberta reckoned that unregulated operators were already holding about 70% of the province’s iGaming action. By April, Nally was saying it was more like 65%.

The cash angle is a major part of the story too. The province gets to keep 20% of net iGaming revenue, and another 3% of gross gaming revenue goes to help First Nations communities and social responsibility programmes. So every time a player stays on an offshore site, they’re sending that cash right out of Alberta.

The advertising question is right at the heart of the plan. In an interview with CBC News in August, Nally defended the increased advertising that’s been happening. “We know that the best way to deal with the black market is to have a healthy, regulated market that can advertise”, he said in that interview.

In the same chat, he pointed out that Alberta had two major safety features that Ontario didn’t have from day one: province-wide self-exclusion and free outpatient treatment covered by the operators.

What Ontario’s Experience Tells Us?

Ontario opened its private market back in 2022, and Alberta took some of the same ideas and ran with them. Even so, Ontario still had a big problem with offshore operators targeting its players four years after the market launched.

And then there are the health data. A study published in the CMAJ found that the number of contacts to a helpline for people with gambling problems went up by a massive 316.7% among boys and men aged 15 to 24. Interestingly, the researchers only looked at the years before Ontario’s PlayOLG website launched in 2015 and the period afterwards. That didn’t necessarily mean the private operators caused the rise in problems; more calls could mean more people are struggling with their gambling, or that more people are feeling brave enough to ask for help.

What Alberta Has Not Said?

Several critical pieces of information remain unanswered. First, Alberta has not stated what enforcement mechanism will be applied and when. Second, Alberta has not disclosed the number of unlicensed operators operating in the province, and there are no penalties set out for the operators themselves.

Such uncertainty becomes important in the case when the deadline will only work if offshore operators expect actions after that.

Expert Analysis: The Real Test Starts on 14 October

We do not see Alberta’s secrecy as a positive factor. The fact that Alberta keeps its strategy secret makes it impossible for operators to develop a response to it. On the other hand, an invisible threat can be easily ignored by operators who are used to ignoring warnings.

In our opinion, the biggest issue lies within the inconsistency of the proposed strategy. Nally wants to eliminate offshore sites but at the same time advocates heavy advertising as the most effective weapon against them. As we see it, such an approach makes player protection a competition in advertising budgets and bigger brands will easily win it.

Furthermore, we believe that the 70% figure should be studied further. According to the Globe and Mail’s editorial board, gambling experts find it too high a percentage for illegal activities. If this is true, then Alberta not only moves gambling onshore but promotes its growth.

Alberta deserves some praise. Starting off with province-wide self-exclusion and operator-funded treatment, Alberta took a head start over Ontario. Nevertheless, these measures affect only players on licensed gambling sites.

It will become clear in the coming months whether the deadline becomes a threat thanks to enforcement actions via payment processors and app stores.