Don Bourgeois: Responsible Gambling and Ontario’s Prohibition Against Athletes and Former Athletes in Marketing
Don Bourgeois, Counsel at Foglers Rubinoff, explores the challenges of balancing responsible gambling and marketing in Ontario
In an exclusive article for Gambling.Re, Don Bourgeois, Counsel at Foglers Rubinoff, delves into the complex landscape of responsible gambling and Ontario's prohibition against athletes and former athletes in marketing. This contentious issue raises questions about striking the right balance between legitimate advertising and responsible gambling objectives, with recent regulatory changes allowing athletes and former athletes to participate in responsible gambling messaging while sparking debates over the decision-making process.
Legal issues around advertising and marketing of gambling products have become significant in Ontario and other jurisdictions. At its heart, the public policy issue is one of responsible gambling and finding an appropriate balance in a jurisdiction for (i) legitimate advertising to develop awareness of a brand and its products, and (ii) the advancement of responsible gambling objectives. The public policy concern – not always well articulated – is that advertising or some forms of it will “induce” individuals with vulnerabilities to participate in gaming when they ought not do so. The individuals may be underaged or have a higher risk profile at the time of their gambling activities.
The July 2023 edition of the IMGL Law Magazine highlights the interjurisdictional nature of the issue. The edition’s theme – “Advertising: A Tale of Bans, Evidence & Education” – notes the range of potential responses by governments and regulators, from “education” at one end to “bans” at the other. Hopefully, “evidence” would be used in the decision-making process to identify the more effective way to deal with the issue.
Ontario’s response since the opening of the regulated, competitive market in April 2022 has included evidence, education and bans. For example, the Alcohol and Gaming Commission of Ontario’s Standards for iGaming prohibited iGaming operators from advertising “inducements” other than on its website or with the express consent of the individual. That consent was obtained at the time of signing a customer. Importantly, the iGaming operator also had to carry out its KYC on that customer prior to the customer playing any games.
Brand advertising was permitted, which was consistent with the overall approach that allowed operators to differentiate themselves based on factors other than “inducements”. An inducement or bonus was permitted once the customer had decided to play with that brand. The brand identification became a critical part of iGaming operator’s marketing and advertising campaigns, leading some operators to use athletes, former athletes, and social media influencers.
While there were restrictions on who could be used and how they could be used to ensure that these brand ambassadors were not attractive to youth, the level of complaints about some athletes and former athletes being used became a regulatory issue in Ontario and other provinces in Canada. The focus of the complaints were on the “responsible gambling” aspect – was the balance appropriate in Ontario in 2023?
Concurrently, there was also political activity at the federal level, which has the constitutional authority over telecommunications. Senator Deacon (unelected member of the upper house in Canada’s Parliament) proposed a bill to require a national framework “with a view to restricting the use of such advertising, limiting the number, scope or location – or a combination of these – of the advertisements or to limiting or banning the participation of celebrities and athletes in the promotion of sports betting”. The policy rationale was that increased exposure to advertising leads to increased participation in gambling activities, particularly by minors and those at heightened risk of harms from harmful gambling behaviours.
As discussed in an early column (May 25, 2023), the Registrar in April 2023 proposed changes to the Standards for marketing which would prohibit the use of athletes and former athletes and of social media influencers or other celebrities who could “reasonably be expected to appeal to minors". The Registrar issued the draft for consultation purposes with a view to implementation of the final version in time for the 2023/24 hockey season. The Registrar did so exercising a statutory authority – an authority that is a cornerstone of Ontario’s regulatory structure to ensure the independence of the Registrar’s decision-making.
Perhaps because hockey is part of the soul of Canadians, the consultations took on a life of its own. The final version, which will take effect in early 2024, continues to prohibit athletes and former athletes and to prohibit social media influencers and other celebrities who could reasonable be expected to appeal to minors. One significant revision after several months is that athletes and former athletes may be used for responsible gambling messaging. The AGCO also undertook to engage with the sector and to provide guidance on such things as who is an athlete or former athlete to which the prohibition applies, and what would be the test to determine whether a celebrity meets or does not meet the “reasonably be expected” threshold.
The length of time between the proposed Standard and the issuance of the final Standard suggests that there was some intra-governmental discussion prior to the final version being issued. Interestingly, that final version was almost the same as the draft, but for the ability to use athletes and former athletes for responsible gambling messaging. Canadian commentators – such as Steve McAllister’s September 14th edition of Gaming News, both in the podcast and newsletter – noted that “the dynamics at play between the AGCO and the … [provincial] government over the commission’s handling of the amended standards”.
Mr. McAllistair also noted concerns with uncertainty in the sector arising from personnel changes at the AGCO and potential further changes. The chair of the board was replaced and a new Registrar was hired on the retirement of the previous Registrar. Mr. McAllistair also commented on the potential for changes with other executives who were instrumental in implementing iGaming in Ontario – an implementation that while not without some bumps along the way, has generally been considered to have been a success and model for other Canadian provinces.
The developments over the summer leave two outstanding questions – (1) what the AGCO’s ongoing engagement with the sector will be for developing its guidance and, of course, what will be that guidance, and (2) who will and how will the balance in significant public policy issues be determined going forward. These public policy issues involve a balancing of legal, political, and business dynamics – which may be the underlying crux for Mr. McAllister’s comment. Who and how is it decided that the balance is appropriate?