In many ways, Canada and the United States have a lot in common. When it comes to legal structure, however, the differences are overwhelming. The fact is abundantly evident in Canada gambling laws compared to those in the US.
Half a century ago, there were many similarities. Neither country was keen on gambling throughout the late 1800’s and early 1900’s. Gambling still occurred, practically unabated, in underground (illegal) gambling circles.
In the US, Nevada became the first major, legal gambling destination around 1930. The states of Iowa, Illinois, and Louisiana eventually passed laws to legalize riverboat gambling to circumvent the Wire Act of 1961 (relating to the ‘transmission of wagering information‘), which reinforced the federal prohibition on gambling in most parts of the country.
Canada gambling laws didn’t catch up until the 1970’s, when the Criminal Code gave individual provinces the right to legalize and regulate the activity. Many chose to do so, sparking a new revolution in gambling—and revenue stream for local governments—across the country.
Canada and US Take Different Approach to Online Gambling
Today, the biggest differences in Canada gambling laws and those of the US came with the introduction of online gambling. Internet casinos, poker rooms and sportsbooks first appear just before the turn of the millennium, and as connection speeds improved, the popularity of iGaming soared.
Canadian provinces were quicker to respond to online gambling than the US. British Columbia was the first, jumping aboard the iGaming bandwagon with the launch of its own, provincially regulated online gaming site in 2004.
Quebec took a ‘wait and watch‘ approach, following in BC’s footsteps in 2010. Ontario did the same, but not until 2015. Manitoba traversed a somewhat different route, choosing to ally with BC. Residents in Manitoba are able to access BC’s iGaming website, PlayNow.com, through a special player base and revenue sharing deal.
US Goes the Opposite Direction
In the US, the legal landscape has been much different. The federal government, under the guidance of the George W. Bush administration, passed the Unlawful Internet Gambling Enforcement Act (UIGEA) in late 2006.
The UIGEA was meant to reinforce the Wire Act of 1961 by defining all online gambling as an illegal activity. It specifically prohibited:
|“…knowingly accepting payments in connection with the participation of another person in a bet or wager that involves the use of the Internet and that is unlawful under any federal or state law.”|
From a legal standpoint, all this really did was threaten financial institutions that helped facilitate payments between offshore online gambling websites and American players. Thus the vast majority of operators continued accepting US players, right up until April 15, 2011, henceforth known as the Black Friday of Online Poker.
The US Department of Justice seized the websites of PokerStars, Full Tilt Poker and Absolute Poker, confirming that the government did have the right to go after ‘illegal‘ operators. Since then, very few online gambling sites have dared access the market, except where since regulated in Delaware, Nevada and New Jersey.
Following a reversal in the DoJ’s opinion of the Wire Act/UIGEA, US states were given individual rights to legalize and regulate online gambling at their own discretion. This essentially mirrored the Canada gambling laws of the 1970’s.
However, neither the Canadian government, nor provincial governments, have ever (successfully) enacted prohibitions against offshore operators accessing their market. International online casinos cannot ‘advertise‘ their services to Canadians, but accepting them is perfectly legal.