In late August 2021, the Government of Canada gave the green light for single-event sports wagering across the country. And while Ontario is offering private operators an opportunity to get in on the action, the race for a license can be difficult to navigate.
The decision to legalize single-sports betting represents one of the most significant changes for Canada's gaming industry in years. It also comes after a decade of lobbying on behalf of gaming industry stakeholders to allow Canadians the ability to wager on the outcome of individual sports games, as opposed to several matches at once. As I wrote in my last post, this prohibition on single-event betting is known to have kept approximately $14 billion out of the economy every year. And as you can imagine, the benefits of this change will be widely shared.
Meanwhile, early indicators look good for private operators who are now applying for licenses available in Ontario to offer single-sports betting. The challenge, however, is that, without appropriate internal resources and in-depth knowledge of both the Alcohol and Gaming Commission of Ontario (AGCO) and new iGaming standards, the journey to becoming a licensed single-sports betting provider is going to be an uphill climb.
So, you want to be a registrant. What next?
Single-sports betting can be a boon for private gaming operators. But acquiring permission from the AGCO to do so requires embedding the necessary controls, frameworks, and compliance strategies right from the beginning.
Certainly, the path from application to approval requires several important steps, including:
- Mapping existing controls, to get a sense of where you're starting
- Conducting a gap analysis to reveal missing controls
- Identifying the needs of both internal and external auditors
- Designing and implementing a regulator compliance framework
- Developing a control activity catalog to submit to regulators
- Obtaining an independent review of those controls around design, implementation, and effectiveness.
These requirements are similar to changes that land-based gaming standards have posed in the past. And as I and our KPMG teams have found in helping large-scale operators navigate these transitions over the years, the process typically spans two phases:
- Control verification: Demonstrating to regulators that a control catalog that adheres to the requirements of the new standard is in place.
- Ongoing compliance: Proving that your organization has the operating effectiveness to comply with the standard on an ongoing basis.
Timelines for approval can differ, but the important thing is to get the compliance requirements right. The AGCO can be hands-on and will have very high expectations of license applicants throughout the process.
Put another way, applying to offer single-sports betting will be anything but a "tick-the-box" exercise. It will be an ongoing and iterative process that will subject applicants to in-depth reviews and back-and-forth commentary. In short, if you want to play, you need a proven game plan.
Know what to expect
The introduction of single-event wagering in Canada is among the largest of leaps in this space, but it is not uncharted territory. From one standard to the next, we've helped operators of every size learn their requirements and make it to the finish line. That includes assisting those who made the shift to new land-based gaming standards, partnering with iGaming operators to comply with online gaming regulations, and helping smaller operators find their footing.
From my perspective and experience working on these kinds of projects, common among all of them is the need to understand what's expected of the applicant, pinpoint what they're missing, and chart a roadmap for compliance. In other words, I can tell you that taking advantage of Canada's new sports betting rules is entirely doable, but it will require a team—comprised of both applicant and advisor—that can bring its "A" game.