OTTAWA — Canada's horse-racing industry is calling for special protections as legislators weigh a private member's bill to allow one-game sports betting.
Betting on single games or competitions is currently illegal for all sports except horse-racing. The bill, being scrutinized by the House of Commons justice committee, would amend Criminal Code provisions that prohibit gambling on single games of football, hockey and other sports.
Las Vegas-style betting on single games would eat into the multibillion-dollar black market by legally opening the books to gamblers eager to lay down money on individual games rather than just Proline-style betting, where they wager on fixed odds around two or more games.
Bill C-218, proposed by Conservative MP Kevin Waugh, has garnered tentative support from a horse-racing industry that remains wary of casinos and offshore gambling websites encroaching on its turf.
"The horse-racing market is a zero-sum game," said Woodbine Entertainment Group CEO Jim Lawson, who heads Canada's largest racetrack operator.
"Horse-racing wagerers that would access fixed-odds betting will move away from the Canadian parimutuel pools. This will dramatically cannibalize the Canadian horse-racing industry’s market share, and these operators would earn their revenue without contributing to the substantial cost of producing our content," Lawson told committee members Tuesday.
Under Canada's parimutuel wagering system, the odds and potential payouts fluctuate until the horses leave the starting gate. And a portion of the profits go to "horse people" — horse associations, breeding programs and equine aftercare programs — Lawson noted. In contrast, fixed-odds payouts are settled when the bet is made, with no profit sharing.
"This distinction is at the heart of the gravest risk to the Canadian horse-racing industry," Lawson said.
More than two dozen U.S. states have moved to legalize single-event betting after the U.S. Supreme Court struck down a federal ban in 2018. The prohibition's initial aim was to curtail match-fixing — it's easier to scheme when there's just one game to manipulate — but it became increasingly ineffective amid the rise of offshore wagering sites.
Waugh says the main goal of Bill C-218 is to level the track globally against large foreign sites such as Bet365 and Bodog that garner more than $4 billion from Canadian bettors each year, according to the Canadian Gaming Association.
Casinos might also benefit, but if the bill passes it will be up to the provinces to decide whether to permit them to book single-game bets on horse-racing.
"The more money I put down at Woodbine on Dancers Halo, the less odds I get. Where at the casino, it's fixed odds — it stays maybe nine to one. At Woodbine it was nine to one to open in the morning, but now it's a seven-to-two favourite. And that's what they're worried about," Waugh said in an interview.
"It's a valid argument."
Racetracks of Canada president Willian Ford is calling for amendments that would bar any organization from accepting a fixed-odds wager on horse racing, thus shielding the industry from rivals at home and abroad.
“We can see the writing on the wall. The legalization of single-event sports betting will see the influx of massive foreign companies and leagues entering the Canadian wagering market. Competition will be severe and racing will see market share shrink over time," said Ford, whose group represents more than 40 racetracks across the country.
Ford is also asking Ottawa to legalize historical horse racing. The move would allow gamblers to wager on past races, with vendors drawing from a database while preventing players from identifying the race before locking in a bet.
Bill C-218, originally introduced more than a year ago and reinstated last fall, is similar to a government bill tabled in November and withdrawn last month. The government legislation, known as Bill C-13, included protections for the horse-racing sector.
Waugh hopes his bill will come before the House for third reading in April.
The legislation also mirrors previous parliamentary attempts to reclaim for casinos some of the $10 billion that the Canadian Gaming Association estimates is lost annually to the black market, on top of the cash hoovered up by overseas gambling websites.
In 2012, then-NDP MP for Windsor-Tecumseh Joe Comartin tabled a private member’s bill to allow single-game betting. It zipped through the House of Commons with all-party support but foundered in the Senate and died when an election was called in 2015.
Liberal MP Irek Kusmierczyk — Windsor-Tecumseh’s current representative — says the bill is about protecting 2,500 casino jobs at Caesars Windsor casino as well as bolstering the pandemic-battered tourism industry and the Ontario Lottery and Gaming Corp.’s bottom line.
Chris Lewis, former commissioner of the Ontario Provincial Police, stressed how profits from black-market bets on single games continue to fuel organized crime.
In December 2019, the OPP Organized Crime Enforcement Bureau broke up a Hells Angels-run illegal gambling ring in southwestern Ontario that brought in $131 million over a five-year period, largely through five wagering websites, Lewis said.
"Based on the average profit margin of five to six per cent for a sports book operation, this single organized crime operation would have accepted close to $2.5 billion in illegal wagers," he said.
He noted the personal risk to players due to loan sharking at “exorbitant criminal interest rates,” with the threat of violence and financial ruin lurking perpetually around the corner.
“The government of Canada cited that one of its primary reasons for legalizing cannabis was to eliminate the criminal element and to reduce organized crime's access to the large profits generated. It’s time to apply that same logic to sports wagering and pass the amendment to the Criminal Code to permit single-event sports wagering," Lewis said.
This report by The Canadian Press was first published March 9, 2021.
Christopher Reynolds, The Canadian Press
