British Columbia cracks down on unlicensed operators

 Canadian province issues stark written warning to operators and asks European regulators for help

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The Canadian province of British Columbia (BC) has written to the chief executives of 19 gambling sites active in the province, warning them their actions are “likely” illegal.

The letter, sent late in August and seen by EGR, states: “The British Columbia Gaming Policy and Enforcement Branch (GPEB) has reason to believe that your company is conducting and managing a lottery scheme which facilitates online betting within the province of BC.

“No person, other than [the state lottery] British Columbia Lottery Corporation (BCLC) may conduct, manage or operate a lottery scheme in BC; and no person may offer gaming services in British Columbia unless they are authorized by GPEB to do so.

The letter falls short of explicitly calling the firms’ actions illegal, but adds: “GPEB must caution that any gambling conducted, managed or operated by a company or individual in BC is likely to be contrary to both the Criminal Code of Canada and the Gaming Control Act.”

The province, which has a population of 4.6 million – the third most populous province in the country, warns that a first conviction could result in a fine of up to CA$100,000 (£58,000).

BC has also reached out to other provinces in Canada, and gambling regulators in Europe, to share its list of grey market operators and “discuss the legal framework for gambling in BC”.

The BC Ministry of Finance told EGR it is also meeting in person with overseas regulator in the autumn, adding:  “We believe that when informed, these offshore companies will respond positively by ceasing their online gambling and betting services to BC residents.”

However one operator contacted by EGR said the letter “probably doesn’t mean anything”.

“These things go on all the time,” the source said. “In Germany for example – different states get enthusiastic from time to time about writing people nasty letters and generally it goes away.

“I wouldn’t say we don’t take it seriously but it’s a regulator in one Canadian province. BC has been trying to get the other Canadian provinces to co-operate on a joint approach and they have all refused. If all the provinces felt the same way they’d have some co-operative effort going on but they don’t.”

Another source with knowledge of the Canadian market said this could perhaps have a bigger impact on listed firms or companies with a physical presence in Canada.

Canadian law states it is criminally illegal to operate a real-money gaming platform from within Canada, except for the state-run provincial lottery companies.

However if companies can establish they have no real and substantial link to Canada – i.e. their servers are located overseas – then they so far have been safe from prosecution.