Operators Must Follow Exit Procedure, Says Ontario Regulator

Canada’s first-ever open iGaming market for third-party operators in Ontario has been rapidly expanding since its launch, but recently, an operator stirred the pot with its departure. However, the regulator of the market, the Alcohol and Gaming Commission of Ontario, stated that operators who exit the market should also abide by the departure regulations.

Ontario’s market for online gambling and sports betting first kicked off operations on April 4, 2022, and since then over 70 gaming websites have made their way into it and are up and running. Governed by AGCO and its subsidiary iGaming Ontario, the sector has the objective to eliminate the grey market operations and keep a portion of the revenue for the province’s economy.

Exit Regulations Apply

Just recently, AGCO reminded that there are also regulations on how an operator should make its official exit from the market. The statement came after Coolbet recently informed that it will be suspending services in the province. As of Wednesday, the operator ceased its online casino and sportsbook platform in the province and plans to fully go offline by April 3, 2023.

The regulator said the province’s iGaming standards must be met for all instances where the relationship between the operator and a player is terminated. This also includes scheduled shutdowns and business closures. The commission also discusses with operators, to ensure that departure does not in any way, undermine the integrity of the gaming sector in the province.

For instance, AGCO mandates players’ funds must be handled appropriately and that players be allowed to withdraw funds from their accounts in a timely and accurate manner, subject to authorization. In addition to that, when player accounts are deactivated, then users must be permitted to recover the balance of their account owing to them.

However, the regulations on settling wagers are slightly more subjective that the clear rules for refunding money to bettors. This could come as bad news for users who hold a digital ticket for a potentially winning futures bet which will not be decided until after an operator has shut down in the sector. Still, Coolbet assured pending futures and parlay wagers would be voided and refunded.

Reasoning Behind It

Coolbet officially announced its departure from the Ontario market last week. The operator elaborated it was putting the maximizing of profitability first as well as the investment capital and resources into only the highest return regions. However, in Ontario, the operator does not see a near-term path to profitability and will focus its efforts on other market opportunities.

But still, its departure has been the cause of concerns in the regulator iGaming sector. Needless to say, its exit left many wondering if more operators would follow its example and leave the market due to its highly competitive nature. However, some operators in the province, assured that they plan on renewing their agreements with AGCO and iGO and continuing their operations.

Source: Zochodne, Geoff “What Happens in Ontario When a Sports Betting Site Leaves?” Covers, March 23, 2023