OLG To Launch Internet Gaming

OLG To Launch Broad-Based Consultations For Best-Practices

TORONTO, Aug. 10 /CNW/ - Ontario Lottery and Gaming Corporation (OLG) announced today it will be extending its brand to online gaming.

Jurisdictions in Canada including British Columbia, the Atlantic Provinces, and many European Union states including the United Kingdom, The Netherlands, France and Sweden, already allow regulated online gaming.

"Across Canada and around the world, online commerce is part of our everyday lives and OLG is excited to start the consultation process for online gaming and growing its marketplace in the future," said OLG Chair, Paul Godfrey. "OLG's internet gaming program will stress responsible gaming while providing an enjoyable experience for Ontario players."

Ontarians currently spend nearly $400 million per year online through unregulated internet gaming providers. These mostly-offshore providers are not regulated or licensed to operate in Ontario, nor do they have any mandate to serve the public interest, as OLG does.

OLG will begin a thorough consultation and implementation process over the next 18 months.  Between now and 2012 when the program is set to launch, OLG will benefit from analyzing and enhancing best practices and security procedures adopted in other jurisdictions across Canada and in Europe. In particular, OLG will implement a strong online responsible gaming program and offer increased player protections, secure transactions and data privacy.

OLG's internet gaming program will be regulated by the Alcohol and Gaming Commission of Ontario.

OLG is a provincial agency responsible for province-wide lottery games and 27 gaming facilities including 4 Resort Casinos. With nearly 8,000 direct employees and more than 10,000 employees at the Resort Casinos, OLG returns $2 billion in profit annually for the province. Gaming proceeds support Ontario's hospitals, amateur sport, recreational and cultural activities, communities, provincial priority programs such as health care and education, local and provincial charities and non-profit organizations through the Ontario Trillium Foundation.

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See attached backgrounder documents.

Backgrounder

Ontario Lottery and Gaming Corporation (OLG) announced today it will be extending its brand to online gaming.

OLG will implement a strong online responsible gaming program and offer increased player protections, secure transactions and data privacy.

Jurisdictions in Canada including British Columbia, the Atlantic Provinces, and many European Union states including the United Kingdom, The Netherlands, France and Sweden, already allow regulated online gaming.

Responsible Internet Gaming

Internet gaming presents a wide range of responsibilities for OLG in order to produce a socially responsible and secure online gaming system.

Player Protection

• OLG will undergo a prudent, rigorous process to determine and ultimately incorporate best in class practices and technology.  
• OLG will leverage lessons learned in the last 3 years in the area of Player Protection and Data Analysis to combat potential fraud.
• OLG is subject to and strictly adheres to the Freedom of Information and Protection of Privacy Act (FIPPA) in order to maintain confidentiality and the protection of personal privacy.

Responsible Gaming Tools

• The need to register for internet gaming provides one of the most controlled gaming environments, primarily due to the ability to identify each player, track their play and maintain data on individual players.
• Support Tools allow for maximum player self-control and can optimize OLG's interactions with players who may be at-risk.
• OLG will offer age and identity verification software, as well as security software, to ensure responsible gaming policies are enforced.

Player Requirements

• Players will be required to register for play. OLG player data will adhere to strict privacy and security policies in consultation with the Ontario Privacy Commissioner's office.
• Players will be able to be reminded of 'red flag' behavior by responsible gaming tools built into the online site and players will also be offered other responsible gaming information online.
• OLG's responsible gaming tools will focus on encouraging normal and at risk players to maintain healthy player behaviour.
• Players will be asked to set maximum money and time-per-session limits when their online session begins.
• Players will be encouraged to understand and manage their play, to take a break and to get help if needed.
• Players will be directed toward free treatment services with the appropriate resources. 
• Player will have the opportunity to self-exclude from playing online.

Resources

• OLG will be able to offer online chats about responsible gaming, links to resources in each player's community in Ontario and links to other online gaming help resources.
• OLG will work with responsible gaming organizations in communities and with parents to help provide tools to educate young adults, in addition to age verification software.

Internet Gaming Worldwide

Internet Gaming Laws in Other Countries

Canada: Under section 207.1(a) of the Criminal Code of Canada, only a Province or its designated agency may legally conduct any gambling activities that involve electronic devices. Internet gaming operators are unable to conduct operations in Canada, or to advertise their "play-for-money" sites. However, they continue to advertise "play-for-free" sites extensively, and Canadians spend an estimated $1 billion annually at a range of unregulated gaming sites. While these sites are generally regulated and licenced by a recognized authority somewhere in the world, only British Columbia Lottery Corporation (BCLC) and Atlantic Lottery Corporation (ALC) have so far created a licenced-in-Canada, operated-in-Canada solution for Canadian players. Quebec has announced it will be offering internet gaming in the near future.

European Union: A majority of EU states license and regulate online gaming. In fact, it's common practice that this business is regulated and taxed. Countries have set up a regulatory regime that requires operators to obtain specific licenses and follow specific rules about online-gambling practices.

The Netherlands: Online casinos are legal but the Dutch Gaming Act does not allow Dutch nationals to take part in online casino games operated by a company which does not have a Dutch license.

The United Kingdom: U.K. legislation allows for online gaming and allows foreign operators to provide games for U.K. citizens. Operators are required to have approval from a U.K. or approved foreign regulator (e.g. Alderney)

Denmark: Legislation allows for online gaming, and allows foreign operators to provide games if they secure a licence and pay fees. In addition, Danske Spel (the state-owned gaming corporation) intends to operate their own gaming site, in partnership with a private operator.

Sweden: Svenska Spel is the state-owned corporation overseeing all gaming in Sweden, including casinos, game machines, sports betting, poker games, lotteries and internet gaming. Svenska Spel's online gaming portal currently offers everything from sports betting to poker, bingo, and lottery. Other operators are not regulated by the government, but continue to operate in a grey market, and retain about 70% of the online gaming market.

United States: Until 2006, the U.S. was the largest global market for online gaming, until it was prohibited through the Unlawful Internet Gambling Enforcement Act (UIGEA). In late July 2010, a bill to legalize online gaming passed the House Financial Services Committee, directing the U.S. Treasury Department to license and regulate internet gaming. Advocates in Congress hope the legislative process to approve online gaming will be complete by Fall 2010.

OLG Process

What is Internet Gaming?

• OLG will choose from a full range of offerings to be delivered on the internet, through an online site accessible via personal computers, laptops, and other internet-connected devices. The offerings could include lottery ticket sales, e-instant tickets, interactive casino-style games (against the house), and peer-to-peer games like poker.
• Today, Ontarians are estimated to have between 400,000 and 500,000 accounts with unregulated grey-market internet gaming providers, spending an estimated $400 million per year online, with none of the proceeds being channeled back to Ontario communities through the government of Ontario.
• These unregulated sites have no mandate to serve the Ontario public interest and are largely located offshore with virtually no government oversight.

Potential Value

• OLG now has the ability to catch up with several other Canadian and European jurisdictions in this emerging and fast growing global market of licensed online gaming. 
• A 2007 survey by eCommerce Online Gaming and Regulation Assurance found that the "Majority of 10,000 internet players surveyed are 'more likely to play' at sites with Responsible Gaming features than at 'less socially responsible' sites, because they help to build 'customer trust and confidence'" in online gaming.
• In 5 years of operation, internet gaming could potentially deliver $100 million or more in net profit to the province and potentially generate similar amount in spin-off economic activity.
• It will create new highly skilled jobs in Ontario, both within OLG (to manage customer information, develop marketing, etc.) and with service providers/vendors (to operate the game servers, provide customer support, etc.).

How it is Delivered?

• OLG will prepare a fully transparent and competitive RFI (Request For Information) to inform the development of an RFP (Request For Proposals). The competitive RFP process will identify potential service providers that will capture the maximum benefit for the province, create local jobs and economic activity, protection of player information, and adhere to strict codes of responsible gaming conduct.
• OLG will consult and partner with independent Responsible Gaming groups to design and deliver program elements.
• OLG will work with its regulator, the Alcohol and Gaming Commission of Ontario (AGCO), to ensure regulatory compliance, and with other jurisdictions to co-operate on the delivery of a cross-Canada platform for peer-to-peer games, including with British Columbia Lottery Corporation (BCLC), Atlantic Lottery Corporation (ALC) and Loto Quebec.

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For further information:

OLG Media Relations, 888-946-6716, www.OLG.ca