DOJ taking Another Look at US Online Gambling Laws

Are US and Canada to become the doppelgangers of online gambling regulation?

US and Canada to become the Doppelgangers of Online Gambling?The way US and Canada online gambling laws stand now, there are many similarities, with a few important contrasts. But there are waves rising in the waters on both sides of the 49th parallel that could bring them closer to egalitarianism than ever before.

According to the Associated Press, the US Department of Justice is rethinking its opinion towards cross-border player pooling between states where online gambling is lawfully regulated. At the same time, an argument for the legalization of single-event sports betting is brewing in Canada.

Major Similarities Between US and Canada Online Gambling Laws

There’s a lot these neighboring nations have in common when it comes to internet gambling. The most critical is the way their federal governments pass responsibility off to their subdivision of jurisdictions.

In the US, the federal government decides what forms of gambling can and cannot be legalized. As of 2011, online gambling has been permissible. It’s the state government that must decide whether online gambling—or any form of gambling, for that matter—should be legal or outlawed. If legal, the state decides which forms of gambling to permit, and which to prohibit, and must script legislative guidelines to regulate the legal activities.

The exact same can be said of Canada. Here, the federal government lays out the basic rules for what gambling is and is not permissible. For example, casino and poker games are okay, as are parlay (multi-pick) bets on sports, but single-event sports bets are not. Each province will decide what to offer, and how to offer it, setting up their own regulatory bodies to govern it.

At present, a handful of US states offer online casino and/or poker games, and because sports betting was just legalized in May of last year when the Supreme Court overturned the 26-year old PASPA Act, several more states are scrambling to get laws on the books to offer that as well.

In Canada, only B.C., Manitoba, Ontario and Quebec offer online casino gambling. They also offer online lotteries, as does the Atlantic Lottery Corp in New Brunswick, Newfoundland and Labrador, and Prince Edward Island.

US DOJ to Revisit Interstate Wagering Laws

Back in December of 2011, the Department of Justice—just months after initiating the Black Friday of Online Poker (April 2011)—made the historic decision to opine that the Wire Act—the same Wire Act that gave them the basis for Black Friday—applied only to sports betting. Therefore, online poker (and other online gambling activities, outside of sports betting) were not illegal at all. That was the moment US states were given authority to legalize non-sports iGaming.

The Wire Act also prohibits interstate wagering, but again, it applies only to sports betting. Or at least, that was the DOJ ‘s opinion back in 2011. Now, the Department is taking another look, and says it may issue a new opinion that the prohibition of cross-border wagering applies to all forms of gambling.

If that’s the case, not only will US laws mimic those of Canada more closely, wherein jurisdictions are obligated to ring-fence their gambling activities, it could spell disaster for certain online gambling operations to the south. Delaware, for example, has an online poker market that’s only surviving because of a shared player contract with Nevada.

No doubt if the DOJ’s opinion is reversed, the law will be challenged in the court system.

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