Gaming and Hospitality Lawyers
In Canada, gambling regulations can be quite stringent at times, with the Criminal Code making it illegal to run or participate in any form of unlicensed gambling. However, the provinces have the authority to create their own gambling and casino laws under Section 207(1) of the Criminal Code. This legislation enables provinces to run or license gambling operations. Authorities are increasingly focused on cracking down on illegal gaming establishments, resulting in various charges for those involved in unlicensed gambling activities.
What are the primary legal restrictions on gambling in Canada?
In Canada, gambling is generally prohibited except for operations run by the province or those with a provincial license. The Criminal Code has a section referred to as “Disorderly Houses, Gaming and Betting,” which lists illegal gambling offenses. These include maintaining a gaming or betting establishment (s.201), permitting a premises to be used as a gaming house (s.201(2)), book-making and betting (s.202), and placing bets for others (s.203).
Authorities are focusing more and more on shutting down illegal gaming establishments, which leads to charges laid against Found-Ins, Keepers, Bookmakers, and Bettors. This prohibition has two main exceptions: gambling operations run and managed by the Province; and gambling operations run and managed in accordance with a Province-issued license. The Criminal Code’s “Disorderly Houses, Gaming and Betting” Part VII contains the list of illegal gambling offences. The Criminal Code sets out several charges related to illegal gambling. Maintaining a Gaming/Betting Establishment (s.201); Individuals within or owners granting permission for the operation of the premises as a Gaming House (s.201(2)); Book-Making and Betting (s.202); and Placing Bets for others (s.203).
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How does the Criminal Code define a “common betting house” and a “common gaming house”?
A “common betting house” is any place used to facilitate or encourage betting, allow bets to be recorded or paid, or announce betting outcomes. A “common gaming house”, simply put, is where gambling occurs under the Criminal Code’s definitions, typically maintained for profit, with the gaming activity known and supported by the person in charge, involving the potential for participants to win or lose money or valuable commodities, and requiring payment to play.
Common gaming houses are places where wagering and gaming are conducted under the Criminal Code. These facilities may be available to the general public or may be private spaces reserved for a select group of people. A few general signs of whether a place of business is a typical gaming house might be as follows: the gaming area is maintained for profit; the person in charge of the location where gaming takes place is aware that gaming is happening and is, in some way, supporting it; the game’s participants have the opportunity to win or lose money (or another valuable commodity); to play the game, there is a cost (direct or indirect); the person in charge of the location where gambling takes place receives a percentage of the game’s earnings; there is a bank that is not owned equally by every player, or every player does not have the same chance of winning. The Criminal Code states unequivocally that a location is not a “common gaming house” when it is occupied and used by an incorporated genuine social club or a branch thereof, provided that no money is paid to the keeper directly or indirectly for bets placed or games won there, and no fees are assessed to individuals for the privilege of playing there other than those that are authorized by and in compliance with the terms of a license granted by the Attorney General of the province in which the location is located, or his designate. Person found in or owner permitting use of premises as a Gaming House (s.201(2)).
The offences of Person found in or owner permitting use of premises as a Gaming House (s.201(2)) is a straight Summary Conviction offence. Betting and Book-Making (s.202) The offence of Betting and Book-Making (s.202) is typically pursued strictly as an indictable offence. The maximum sentence that can be imposed for a first offence, is imprisonment for not more than two years. For a second offence, the maximum sentence is imprisonment for not more than two years and not less than fourteen days. For each subsequent offence, the maximum sentence is imprisonment for not more than two years and not less than three months.
Stages of the Criminal Justice System
What constitutes maintaining a gaming or betting establishment under section 201 of the Criminal Code?
Maintaining a gaming or betting establishment (s.201) is considered a hybrid offense, meaning the prosecution can choose to proceed either summarily or by indictment. The maximum penalty if proceeded by indictment is two years. This section refers to places used for gambling purposes, where the establishment is open, maintained, or used to facilitate betting among individuals or allow the keeper to manage the betting activities.
What are the penalties for betting and book-making under section 202 of the Criminal Code?
Betting and book-making (s.202) is a straight indictable offense, with a maximum sentence of up to two years for a first offense. For a second offense, the maximum sentence is up to two years with a minimum of fourteen days, and for subsequent offenses, the maximum remains two years with a minimum of three months. This section covers activities such as recording or registering bets, selling pools, and controlling devices or money related to gambling transactions.
Are there any exceptions to what constitutes a common gaming house?
Yes, the Criminal Code specifies that a place is not considered a common gaming house if it is occupied and used by an incorporated genuine social club or its branch, provided no money is paid to the keeper directly or indirectly for bets placed or games won, and no fees are charged other than those authorized by a license granted by the provincial Attorney General or their designate. This ensures that genuine social clubs can operate without being classified as illegal gaming houses.
Gambling in Canada is heavily regulated, with strict laws outlined in the Criminal Code to control and limit unlicensed gambling activities. Provinces have the authority to run or license gambling operations, providing a structured framework within which legal gambling can occur. Understanding these laws is crucial for anyone involved in or considering entering the gambling industry in Canada.
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Recent Cases
Mohawk Council of Kahnawà v. Gaming Ontario, 2024 ONSC 2726
The Mohawk Council of Kahnawà (the Council) claimed that Ontario’s igaming program was illegal and contested its legitimacy. Established in 2021, the iGaming scheme entails the operation and management of regulated online lottery schemes by iGaming Ontario (iGO), a subsidiary of the Alcohol and Gaming Commission of Ontario (AGCO). The Council contended that the plan violates the Criminal Code, which reserves the authority to oversee online gaming to provincial governments, by illegally allowing private owners and operators to do so.
Two legislative provisions were proposed to be declared inoperative by the Council. The first required providers of products or services for lottery schemes to be registered, and the second stipulated that online lottery schemes provided by registered suppliers are legitimate. The Council argued that these clauses essentially permit commercial organizations to carry out and oversee gaming, in violation of the Criminal Code.
In response, Ontario and iGO contested the Council’s authority to file the application, claiming that Ontario is the one in charge of running and overseeing the igaming program. They argued that the plan upholds the separation of powers and conforms with statutory interpretation.
After examining the matter, the Court determined that the Council had standing because of its legitimate interest and the significance of the matter to the public. Next, the Court evaluated whether the province was carrying out and overseeing the igaming program in accordance with the law. It examined case law, statutory background, legislative history, and cooperative federalism tenets. According to the Court, iGO continues to have significant control over the igaming scheme, for example, the choices made for games, how data is used, who gets subcontracted, advertising, customer support, and responsible gaming policies. Consequently, iGO, and not private operators, is the scheme’s driving force.
In the end, the Court decided in favour of Ontario and iGO, concluding that the provincial igaming program complies with cooperative federalism principles and the Criminal Code and does not illegally transfer power to private operators.
Slobodinsky v. Canada (Public Safety and Emergency Preparedness), 2024
Here, the defendant L.S. was scheduled for an Immigration and Refugee Protection Act (IRPA) admission hearing. According to the Minister of Public Safety and Emergency Preparedness, L.S.’s criminal and organized criminal past rendered him ineligible for entry into Canada. In particular, he was found guilty of participating in an unlawful gambling enterprise in accordance with Israeli Penal Law section 225. The Canadian Criminal Code would classify this as an indictable offence if it were committed there.
The case looked at whether L.S. was a member of a criminal organization and whether the group had a history of committing crimes. The evidence put forth demonstrated Slobodinsky’s involvement in the transmission of funds for Shai Raviv’s gambling website business. The Court determined that L. S. had been deliberately ignorant to the illegal character of the operations, despite his claim that he was only slightly involved in the scheme and was unaware of its full scope of illegality.
The Court came to the conclusion that L.S. was a foreign national convicted of a crime that, had it been committed in Canada, would have resulted in an indictment. In addition, he satisfied the requirements for organized crime under IRPA sections 36(2)(b) and 37(1)(a) due to his affiliation with a structured criminal organization focused on illicit gambling. As a result, L. S. was given a deportation order by the Court.
Tsuu T’ina Gaming Limited Partnership v Alberta Gaming, Liquor and Cannabis Commission, 2023 ABCA 135
The Alberta Gaming, Liquor and Cannabis Commission (AGLC) was challenged by the Tsuu T’ina Gaming Limited Partnership and other related organizations for its jurisdiction over PlayAlberta, an online gambling platform. The appellants said that the Commission had behaved irrationally, in bad faith, and with a conflict of interest, and that the AGLC lacked the statutory jurisdiction to approve and run an online gaming service. They further asserted that the Commission disregarded economic reconciliation with Indigenous peoples, the COVID-19 shutdown of on-site casinos, and Alberta’s casino moratorium policy.
The Court of Appeal looked into whether the AGLC has the statutory jurisdiction to run PlayAlberta and if the chambers judge erred in concluding that the majority of the appellants’ claims were time-barred. The chambers judge’s ruling that the judicial review application was submitted beyond the six-month statute of limitations was upheld by the court. It did, however, conclude that the allegation that the Commission lacked statutory jurisdiction was not time-barred because an otherwise illegal decision could not be made any more valid by the passage of time.
The AGLC operated within its legislative jurisdiction as per the Criminal Code and the Gaming, Liquor and Cannabis Act, the Court determined. It was decided that the AGLC’s running of PlayAlberta as a province lottery was legal. The appeal was dismissed by the court because the appellants were unable to provide evidence of a mistake in the chambers judge’s ruling.
In addition, he satisfied the requirements for organized crime under IRPA sections 36(2)(b) and 37(1)(a) due to his affiliation with a structured criminal organization focused on illicit gaming. As a result, L. S. was given a deportation order by the Court. This shows the kind of serious repercussions that might occur if caught with illegal gambling, making it highly important to consult a lawyer if you are charged with this offence.
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About the Author
Jordan Donich
Jordan Donich has been a Lawyer for over 10 years and is a trusted legal analyst by Canadian Media. He is as a leader in Canada’s tech sector for lawyers and developer of Law Newbie. Jordan is a Black Belt with the Japan Karate Association and trained in Krav Maga. He won a Gold Medal at 2004 Canadian National Championships and was published in the National Newspaper Awards.
Jordan has been featured in Forbes and is a member of DMZ Angels in Toronto.