Ontario extends olive branch to unregulated operators with new application process

Ontario’s Alcohol and Gaming Commission (AGCO) will allow the province’s unregulated operators to switch to regulated operations as part of a “fair” transition to the new-look legal market.

Releasing its Internet Gaming Operator Application Guide, AGCO confirmed it would allow unregulated firms to apply for a licence on the condition that all illegal operations are terminated.

“AGCO has developed a regulatory framework to ensure honesty and integrity for igaming in Ontario and to protect Ontario consumers while, at the same time, facilitating a business-like transition from unregulated to regulated igaming scheme that is fair for registrants,” the regulator said.

All applicants, including both operators and suppliers, must cease all unregulated operations once a registration certificate is received from AGCO and terminate any association they have with other entities operating within the currently gray market.

Any operator or supplier in breach could have their applications rejected by the regulator.

“We will be as practical and pragmatic as possible and consistent with our regulatory mandate when engaging with applicants,” AGCO explained.

The initial registration of operators and suppliers will commence when the province’s own online operator, iGaming Ontario, concludes its first commercial and data agreements.

iGaming Ontario launched in July and operates as a subsidiary of AGCO. It is the first state-run operator in the province and will compete with both local suppliers and the influx of international firms looking to gain a foothold in the Canadian market.

Registered operators under contract with iGaming Ontario may start offering their products and services to people in Ontario in the regulated market from December under proposals.

Operators must pay an application fee of C$100,000 (£58,000) per site, as well as an annual fee of C$100,000.

Supplier fees are much cheaper and start at C$3,000 for a gaming equipment provider, rising to C$15,000 per annum for a manufacturer of gaming equipment.

Any applicant may be required to pay the “reasonable” costs of an investigation prior to processing of their application. These costs would be levied on an as-required basis, depending on whether additional investigative activities are needed and the intensity and cost of those activities.

Prospective licensees are required to provide detailed information on company structures, financial statements, and company incorporation documentation, as well as several other documents.