Market Insider By Robyn McNeil 816 Views

Canadian Single-Event Sports Betting Is A One-Horse Race, As Bill C-218 Passes In The House And C-13 Is No More

Canada just came one step closer to legal single-event sports betting.

On February 17, Bill C-218 passed its second reading in the House of Commons by a vote of 303-15. The bill seeks to repeal section 204(7)(b) of the Criminal Code, which currently excludes bets on the outcome of a single event from the list of allowed forms of gambling. The bill is now in the hands of the Standing Committee on Justice and Human Rights.

The bill’s success shows that the ruling Liberal Party has indeed had change of heart after a well-documented and longstanding reluctance to legalize sports betting in Canada. That reluctance is apparent in the failure of several similar bills over the last decade.

A tale of two bills

Until the end of last week, there were two competing sports betting bills moving through the House. The first, which now advances, is a private member’s Bill sponsored by Conservative Kevin Waugh. The alternative, Bill C-13, was tabled by Justice Minister David Lametti. Although remarkably close in their aim, the two bills differed in that C-13 would keep horse racing out of the hands of provincial lotteries.

That changed the day after C-218 advanced, as the House of Commons elected to abandon Bill C-13. In doing so, it cited a rarely used rule that prevents duplicate bills from advancing through the House. Honourable Anthony Rota, Speaker of the House of Commons, explained this in more detail in his ruling:

“It seems to the Chair that it would not be possible for Bill C-13 to continue in the legislative process, as it would seek to amend a paragraph of the Criminal Code that would no longer exist upon adoption of Bill C-218… As a consequence, the Chair has difficulty seeing how the House could now move forward with Bill C-13 after it has adopted the larger principle of repealing the very portion of the Criminal Code that Bill C-13 seeks to amend.”

About the Canadian lawmaking process

In Canada, how a bill becomes a law is similar to the way things work in the United States, with some subtle differences. Canadians may not be as familiar with the inner workings of their government, however, as unlike the US, we didn’t have a Schoolhouse Rock animated explainer to teach us the Canadian lawmaking process with a catchy song.

That said, it’s relatively simple.

The first reading of a bill happens in either the Senate or House of Commons. If a bill passes its first reading, it moves on to the second. This occurs in the same chamber as the first. After the second reading, it goes to a committee or subcommittee for review. That will be the next step for C-218.

In committee, the bill receives greater scrutiny, and witnesses and experts offer their insights on the legislation. At the end of their review, the committee produces a report including recommendations and amendments. The report then gets sent back to Parliament for a further debate and one more vote.

After a bill passes this third reading, it is sent to the other chamber – the Senate, in this case – where the process is repeated. During this stage, if one chamber requires further amendments, the two chambers will work together until the bill is in a mutally agreeable final form.

The final step is for the Governor General – acting as a proxy for the Monarch – to sign the bill into law.

What’s Next?

So, with Bill C-218 now officially into the committee stage, what can we expect to follow?

The passing of C-218 isn’t a slam dunk yet. However, getting to the committee stage means its chances of making it into law look pretty good. Still, it’s during the debate surrounding the third reading where bills tend to face their strongest opposition. Interested parties will want to keep a close eye on what happens after the bill emerges from committee.

This shouldn’t be too concerning, as Canadian sports betting enjoys overwhelming support from all political parties. Thus, the prospect of significant opposition seems less likely.

Many suspect the government’s historic hard-lined opposition of single-sports betting has softened due to the pandemic’s economic hardships. With casino closures and declining retail lottery sales, government coffers have been feeling the pinch. At the same time, spending has soared to deal with the crisis.

How much will Canadian sports betting be worth?

According to the Canadian Gaming Association, Canadians spend 14 billion each year on offshore black and gray market sports betting. My comparison, provincial lotteries bring in only $500 million.

Clearly, there are buckets of money to be made, both by the government and those who would help with the implementation. That includes TheScore Bet Sportbook, by homegrown sports media company TheScore, which has just had its US IPO on the NASDAQ.