What Happened
The legal foundation for gambling in Canada rests primarily on Section 207 of the Criminal Code, a federal statute that has governed the country's approach to gaming since the late 19th century. While the Criminal Code broadly prohibits gambling, Section 207 creates critical exceptions that allow provinces and territories to conduct and manage lottery schemes—a term that Canadian law interprets broadly to include casinos, sports betting, online gambling, and other forms of gaming.
This framework reflects Canada's constitutional division of powers under the Constitution Act, 1867. Criminal law falls under federal jurisdiction, giving Parliament the authority to define which gambling activities are legal and which are prohibited. However, the administration and regulation of permitted gambling activities is delegated to the provinces, each of which has established its own regulatory bodies, legislation, and operational structures.
Section 207 of the Criminal Code
Section 207 is the cornerstone of legal gambling in Canada. It provides that a provincial government may "conduct and manage" a lottery scheme, either directly or through a designated entity such as a Crown corporation. This provision has been interpreted to encompass virtually all forms of gambling, from traditional lottery draws to casino table games, slot machines, sports wagering, and online gambling platforms.
The breadth of Section 207 has given provinces substantial flexibility in designing their gambling markets. Ontario, for example, has used this authority to create a competitive iGaming market open to private operators, while British Columbia and most other provinces have opted for government-operated models in which a Crown corporation directly manages all legal gambling offerings.
Importantly, Section 207 requires that gambling operations be "conducted and managed" by the province or its designee. This means that private operators cannot offer gambling independently; they must operate under a provincial licence or agreement. In Ontario's case, operators enter into operating agreements with iGaming Ontario, the provincial subsidiary that conducts and manages the online gaming market on behalf of the province.
Bill C-218 and Single-Event Sports Betting
One of the most significant recent changes to Canada's gambling law was the passage of Bill C-218, the Safe and Regulated Sports Betting Act, which received Royal Assent on June 29, 2021. The bill amended the Criminal Code to remove the prohibition on single-event sports betting, which had previously required bettors to wager on combinations of events (parlays) rather than individual games.
The prohibition on single-event betting had been a longstanding frustration for Canadian sports fans and the gambling industry alike. Advocates argued that the parlay-only restriction drove Canadian bettors to illegal offshore sportsbooks that offered single-game wagering. The Canadian Gaming Association, provincial lottery corporations, and several Members of Parliament championed the reform over multiple parliamentary sessions before it was finally enacted.
Following the passage of Bill C-218, provinces moved quickly to implement single-event betting. Ontario incorporated it into its new iGaming market, while BCLC added the option to PlayNow.com, and other provincial lottery corporations updated their sports betting products accordingly. The reform has been credited with significantly increasing legal sports betting activity and improving the channelization of bettors from unregulated to regulated platforms.
Constitutional Division of Powers
The relationship between federal and provincial authority over gambling is shaped by Canada's constitutional framework. The Constitution Act, 1867, assigns criminal law power to the federal government (Section 91(27)) while giving provinces jurisdiction over property and civil rights (Section 92(13)) and matters of a merely local or private nature (Section 92(16)).
In practice, this means that the federal government defines the boundaries of legal gambling through the Criminal Code, while provinces exercise operational control within those boundaries. The federal government does not directly regulate gambling operators or collect gambling-specific taxes; instead, provinces establish their own regulatory regimes, licensing requirements, and revenue-sharing arrangements.
- Section 207 of the Criminal Code allows provinces to conduct and manage lottery schemes
- Bill C-218 legalized single-event sports betting across Canada in 2021
- Provinces have exclusive operational control over gambling within their borders
- The federal government sets the legal boundaries; provinces determine the regulatory details
- Indigenous communities may also conduct gambling under specific legal frameworks
Why It Matters
Understanding Canada's gambling legal framework is essential for anyone following the industry's evolution. The interplay between federal criminal law and provincial regulation creates a uniquely Canadian system in which gambling markets can vary dramatically from one province to another, even though the underlying federal legislation is the same across the country.
This framework has enabled significant innovation—Ontario's competitive iGaming market would not have been possible without the flexibility provided by Section 207. At the same time, the constitutional division of powers means that national standardization of gambling regulation remains challenging. There is no federal gambling regulator equivalent to, for example, the United Kingdom's Gambling Commission; instead, each province is responsible for its own oversight.
"The Canadian model of gambling regulation reflects the country's broader constitutional character: a federal framework that sets minimum standards, with provinces exercising meaningful autonomy in how those standards are implemented."
The passage of Bill C-218 demonstrated that the federal framework can be updated to reflect changing consumer expectations and market realities. It also showed that effective advocacy from provincial governments, industry associations, and public health organizations can drive legislative change at the federal level.
What's Next
Several areas of federal gambling law may see further evolution in the coming years. There is ongoing discussion about whether the Criminal Code should be updated to address emerging issues such as loot boxes in video games, fantasy sports contests, and cryptocurrency-based gambling products. These activities exist in regulatory grey areas under the current framework, and clarity from the federal level could help provinces regulate them more effectively.
The role of Indigenous communities in Canadian gambling governance is also evolving. While Section 207 primarily delegates gambling authority to provinces, several Indigenous communities operate gaming facilities under specific legal arrangements, including the Kahnawake Gaming Commission in Quebec and various First Nations-operated casinos in Ontario, Saskatchewan, and Alberta. The scope and autonomy of these operations continue to be subjects of legal and political negotiation.
At the provincial level, the success of Ontario's iGaming market is likely to prompt other provinces to revisit their gambling legislation. Any expansion of competitive markets would require provincial legislative action, but the federal Criminal Code would not need to be amended, as Section 207 already provides sufficient authority.
For policymakers, operators, and consumers alike, the federal Criminal Code remains the foundational document of Canadian gambling law. Its continued evolution will shape the direction of the industry for years to come, balancing the economic potential of legal gambling with the imperative of public protection and responsible regulation.