Bill C-290 (Historical)

An Act to amend the Criminal Code (sports betting)

This enactment repeals paragraph 207(4)(b) of the Criminal Code to make it lawful for the government of a province, or a person or entity licensed by the Lieutenant Governor in Council of that province, to conduct and manage a lottery scheme in the province that involves betting on a race or fight or on a single sport event or athletic contest.

Criminal Code

[Brian Masse, NDP, Windsor West, ON]

Madam Speaker, I thank the Liberal Party for allowing me to go a little sooner so I can get to another meeting tonight. I appreciate the camaraderie in the House, which does happen in this place.

It is important to recognize the work of the member for Windsor—Tecumseh on Bill C-290. I commend him for his work. He has had this bill in the past and has brought it forth again. It is very timely.

When we think about private members' issues that we can bring forward as members, this is a very serious one because it is about the economy right now. It would provide some extra revenue for the gaming industry. Also, I do not think we should underestimate the issues with regard to organized crime. We are concerned about people with gambling addictions, but we know that sports wagering is taking place under the table, not just in Canada but across the globe. What is really important is that this would take away some of the financing from organized crime.

It is very appropriate that the member for Windsor—Tecumseh is doing this from a local perspective, because we have a casino in Windsor. Sports betting happens in the United States where people take advantage of it. People go to Las Vegas and other areas where they can bet. This would be a benefit because we have a lot of competition from the U.S. with the high Canadian dollar right now. Also, the U.S. is bringing in a series of measures to tax Canadians, and there are other border issues.

We have seen a diminishing tourism industry. The HST being implemented had an affect upon tourism in Canada. Dropping the GST rebate was another blow to the tourism industry. Therefore, it is very important for us to see this as an advantage for us to compete against the United States in the gaming market right now. The U.S. has made efforts and has pushed to bring in single sports betting venues but it has not done so yet, except in Nevada.

From a global perspective, the member for Windsor—Tecumseh is doing his job as a justice critic for the official opposition by bringing forth a solution and a way to tackle crime with regard to the revenue stream that we see happening in the underground economy. I applaud the member on both those fronts. I think that is important to recognize.

Sports betting should not be underestimated. We do not even know the full value of what is going on in terms of the estimates of organized crime and sports betting happening illegally. There have been some studies done and they vary wildly. Some say it is anywhere from $80 billion to $380 billion annually. That is a big spread, but it is a lot of money that is actually out there in the system. Even if we could take a fraction of that by moving on this, it would be important, not just with regard to the employment aspect but also for ensuring that organized crime does not have an extra revenue stream in its repertoire. That is something I think Canadians want to see happen.

It is important to get the bill to committee and, hopefully, through committee really quickly. The sooner we get to this the better.

Coming from the perspective of a border town like ours, Windsor and Essex county, we have seen first-hand the difficulty with the economy. I note that in the supporters of the bill there is the CAW, the city of Niagara Falls, the city of Windsor, the Canadian Gaming Association, the Ontario Lottery and Gaming Commission and several other provincial associations. One of the critical components of the bill is the way it would play itself out. Each province would have an opportunity to make its own decision. I am hoping that we will see the province of Ontario quickly grab onto this.

With reference to the challenges in a border community right now, this would be a shot in the arm for an area that has suffered quite a loss of jobs. I was on city council at the time when we tried to diversify the Windsor and Essex county area a number of years ago by moving into tourism. We were successful with a lot of different venues that we put forth but then there were other challenges. After 9/11, we saw the border change quite significantly. We now have more difficulty getting people to and from the border. This affects Americans coming into Canada as well as Canadians going out. We have extra taxes to pay and so forth. There were a few more problems for us.

We hear stories from the Americans that they feel hassled crossing the border back and forth, even by their own people. What has happened is that, with the artificially high dollar from the high petroleum industry exports that we are doing right now, we have lost. We have gone from basically 60¢ on the dollar when we brought in our tourism strategy, to parity or above. That is a significant shift over a small period of time.

We may think that eight to ten years is not that long, but it is when one is investing in a small business or in the tourism industry. This would provide a shot in the arm to attract visitors to come over.

One of the merits of the bill that is important to notice is that it acknowledges that the world is changing. When we brought the casino into Windsor, it did not have competition across the river but now it does. A series of Detroit casinos have now opened up. There are three casinos in particular, and there are also the aboriginal casinos that are in other parts of Michigan. We have a series of competition that we cannot deny.

In fact, if we walk down to the end of my street and look across the Detroit River, which is two miles, we can see one of the casinos there. Right across from the Windsor casino, Caesars, is the Greektown casino, and not far from there is MGM Grand. Therefore, we have a significant reality to deal with in terms of competition. Offering a different product would be an essential component of protecting those jobs and once again seeing more visitors come over from the United States.

One of the benefits of living in a border society is that we often traverse back and forth for different products and for entertainment. For example, I go to the Detroit Lions game. I regularly cross the border to the United States to see its sports entertainment. Canadian dollars go over there on a regular basis. Many Windsorites go over to see the Tigers, the Pistons, the Lions, all the different organizations that provide sports entertainment.

We would then be reciprocating a different product on this side. The bill by the member for Windsor—Tecumseh is very timely as we have been watching Ohio enter into this market as well. Ohio has now opened up a couple of casinos, which has taken away the destination component that was often important. We had a lot of coaches that would come in with people from Ohio who saw the better service they would get at the Windsor casino. Caesars' product is very good. The brand is terrific. It is the only one outside of the United States. The corporation has made an investment to bring in live entertainment and other initiatives to keep the economy going and keep the jobs at the Windsor casino. People from Ohio would get on a bus and did not mind taking the extra step to come over the border to get a better product.

Now, however, we are competing to get the people out of Ohio because they are staying there. They do not necessarily say, “Let's go to the casino. Are we going to Detroit or Windsor? Which one should we select” and then get on a tour package or drive down and cross over. It was less of a big deal because they were making that effort coming from Ohio anyway. The bill would provide an opportunity for that element to shine as well.

We have some unusual opportunities that will happen over the next number of years that will enhance transportation from Chicago to Detroit. We cannot underestimate that market. There are tens of millions of people who live in that catchment area. Right now, they are moving forward on higher speed rail improvements. I look forward in terms of this bill giving us a marketing advantage to track from Chicago a number of different people who would visit our city. That is a market that we have not entered into much but it is something that we need. It is only five hours away.

The member for Windsor—Tecumseh should be praised for this initiative because he is using his time in the House of Commons to try to make better economic decisions and social justice by tackling the organized crime element. I commend him on that. We need more of that in this place.

[Robert Goguen, Conservative, Parliamentary Secretary to the Minister of Justice]

Madam Speaker, I am pleased to support Bill C-290. This is a private member's bill which the member for Windsor—Tecumseh introduced in the House on September 28, 2011.

Bill C-290 would authorize a province or a territory to conduct single sport betting within the province or territory if it so chooses.

In order to better comprehend how this bill would modify the structure of the current provisions relating to gambling, I will briefly go through the history of the past and current Canadian laws in this area.

As members will notice, the gambling provisions in the Criminal Code are somewhat difficult to read and to understand. Nevertheless, a careful reading of these provisions shows that their basic structure is to prohibit all forms of gambling unless a particular form of gambling is specifically permitted by the Criminal Code.

Parliament has permitted such exceptions to the gambling offences as private bets that are made between individuals who are not in the business of betting. In Canada, we also have pari-mutuel betting on horse races, where the betting is conducted by a race association. Then there are lottery schemes that are conducted by a province or territory and the slightly narrower range of lottery schemes that are conducted by a licensee of a province or territory, such as a charitable organization.

Parliament has also authorized certain lottery schemes that are conducted on international cruise ships while in Canadians waters, if certain conditions are met.

Parliament included gambling offences when it enacted the first Criminal Code in Canada in 1892. There were some exceptions to the offences, primarily for bets made at a horse race. The provisions were expanded in the 1920s to include the exception for parimutuel betting on a horse race. That made it possible to put all the money bet on a horse race into a pool and the winners would share in the pool based upon how much they had bet on a horse that finished in a spot that entitled bettors on that horse to share the winnings.

A most significant change to the gambling provisions occurred in 1969 when the provinces, territories and the federal government were each authorized to conduct a range of lottery schemes. This followed closely on the heels of the reintroduction of legal lottery ticket operations in some U.S. states.

In 1985, Parliament withdrew the Criminal Code authorizations that existed from 1969 for the federal government to conduct a lottery scheme and it went through the authorizations that existed from 1983 for the federal government to conduct a pool betting operation. This left the field of lottery schemes exclusively to the operation by provincial and territorial governments and their licensees.

It was in 1998 that Parliament authorized international cruise ships to continue operating their lottery schemes when they enter Canadian waters and up until the first port of call, if certain conditions are met. That change was made at the request of provinces in order to encourage the international cruise ships to sail to Canadian ports.

Some provinces have offered a particular kind of sports betting as a form of lottery scheme to their residents. The structure of this betting requires the bettor to select a number of games and predict the correct outcome for those games.

Bill C-290 would make it possible for a province or territory to conduct a lottery scheme that involves betting on single games. If Bill C-290 passes, I do not know if any bettors would still make bets on the outcomes of multiple games, but I would imagine that the vast majority of bettors would prefer to bet on a single game and its outcome.

Of course, it would be up to each province and territory to decide if it wanted to offer single sports betting, but that will be their decision.

Under section 207 of the Criminal Code, a province may operate a lottery scheme on or through a computer, but it cannot licence others to do so because single sport betting would, by necessity, require computer operation. Single event sport betting is something that the provinces and territories would conduct themselves because they may not licence others to conduct a lottery scheme that is conducted on or through a computer.

I want to mention that a province or territory could choose to locate a single sport event betting operation in a casino or at a race track, for example, and it could share the profits from the betting however it sees fit. Again, these would be matters for provincial or territorial decision-making. I am assuming that decisions would be made by a province or territory with the values and desires of their residents in mind. That includes keeping an eye open to the measures that are needed to prevent problem gambling.

I can appreciate that not everyone thinks that gambling is for them. However, it is my view that allowing single sport betting, even through a provincial lottery scheme, is far more appropriate than what is currently happening in this country. Betting with an illegal bookmaker is driving money to organized crime.

Bill C-290 is a response that would give the provinces and territories the choice as to whether they wish to join countries such as England where there is legalized single event betting on sports. I emphasize that the provinces and territories would be able to make that decision based on the particular circumstances within their jurisdiction.

The provinces and territories are best placed to determine public acceptance for single event betting and to implement measures for responsible betting. They have decades of experience in conducting a broad range of lottery schemes, from lottery tickets, to casinos with slots, table games and to betting on the outcomes of multiple sports events.

For those reasons, I support private member's Bill C-290 and I will be voting in favour of it.

[Joe Comartin, NDP, Windsor—Tecumseh, ON]

moved that Bill C-290, An Act to amend the Criminal Code (sports betting), be read the second time and referred to a committee.

Mr. Speaker, Bill C-290 is a very short bill; basically one paragraph and a little over one line. If it were to ultimately becomes law, it would delete one section of the Criminal Code. The overall theme of the bill is to deal with a problem that we have in the country with regard to gaming, specifically being able to bet on sporting events.

As it is now, paragraph 207(4)(b) of the Criminal Code prohibits the gaming on a single sports event in Canada. The effect of that does have some very serious consequences and I will go into that in more detail. However, by way of introduction, the primary purpose behind this bill is twofold: first, to create greater employment opportunities in the gaming industry in Canada and in all the provinces who pick this up; and second, at least as important, it is a blow against organized crime that has captured, controls and is making huge profits from it, as ascertained by all the reports.

It is important to set this in a historical context. If we go back and study this closely, the laws on gaming in this country go back to the 1600s in England. I forget who the king was at the time, but it was in a period of time when he was very worried about his military gambling excessively. Laws were then passed in Westminster to prohibit all gambling in the country.

Over the centuries we have eroded that position. In fact, to follow the history in my riding, my predecessor, Shaughnessy Cohen, moved a similar amendment to the Criminal Code that allowed for betting at roulette tables, which was prohibited at the time. It allowed for roulette tables to come into casinos in the country. Following in that tradition, this is one of those periods of time when we should have our criminal law catch up with the reality of what is happening in our society.

In 1985 the federal government effectively gave up the administration of gaming operations to the provinces. It was one of those periods of time when there was some trade-offs going on with regard to revenue sources. This was a mechanism for the federal government to create new revenue sources for the provinces. Since that time a number of provinces have moved into gaming in a variety of ways: lotteries, casinos, additional betting being allowed at racetracks, and we can go down the list.

The role that gaming plays in provincial revenues has become quite significant. It is now literally billions of dollars across the country. In some cases, provinces have declined to take on those operations, but in other cases, provinces have taken them on wholeheartedly and have expanded their revenue base as a result.

To the point where we are with this particular expansion, the provinces would determine how they would implement this. From talking to various provincial administrations, there is a variety of suggestions if the bill becomes law, but ultimately the provision of gaming on single sporting events would vary across the country.

For instance, one province is considering allowing the casinos operated by first nations to take this type of gaming under their control. Obviously, the province would still administer it, but the bulk of the revenue would go to the casinos operated by first nations.

One province in particular is thinking of a very broad expansion using the British model. The gaming would take place in a variety of settings in that province.

In my home province of Ontario, as I understand it at this point, the primary thrust would be to allow the large commercial casinos, the casinos operated for charitable purposes that are smaller operations and potentially the racetracks, to do the administration. It would not expand it into the broader society as some of the other provinces are considering.

Whatever the model is, it is determined by the individual provinces, and some provinces may not take it up at all.

I would note at this point that both the Province of Ontario and the Province of British Columbia are on record with letters to the federal justice minister asking him to proceed with this type of amendment. The government up to this point has not proceeded that way, although I am expecting, and I may be overly optimistic because this is a private member's bill, substantial support from the government side as well as from our colleagues in the Liberal Party.

I will turn now to the real thrust behind this and I will deal with the criminal element first. There is no question that this type of gaming is illegal in Canada as well as in all of the United States, except for Nevada, where it is in fact legal. The casinos in Nevada do allow for single event betting. However, all of the other states and Canada prohibit it.

The end result of that prohibition has been that organized crime has moved into this field in a very big way. We have estimates from the U.S. of revenues coming in to organized crime at a minimum of $80 billion a year. I will repeat that, because when I say that, most people think I said “million”, but I said “billion”. At the low end it is $80 billion, with the estimate running to $380 billion to $400 billion at the high end. That is in the United States. With some of the information we have from our security services in Canada, the estimate is that a minimum of $10 billion is wagered in Canada each year, and it may be as high as $40 billion. That is the type of revenue we are talking about.

All of that money is going into the hands of organized crime. We do not believe that any substantive amount is going into other people's hands. It is controlled by the large criminal organizations, most of which are based in the U.S., but some of which are based here in Canada.

Some of this betting is also taking place offshore through the Internet. A number of those Internet sites are located in the Caribbean, where there is no ability for either the Canadian government or the U.S. government to thwart that type of activity over the Internet.

It is a situation where this activity is going on. Certainly there are people who argue that we are just expanding the ability of people to become problem gamblers. I do not believe that to be the case at all. This gambling is going on right now, all within the control of organized crime as best we can determine.

We are talking about taking it out of the hands of those in organized crime, a strong way to reduce the revenue they are generating, and move it into the hands, in our case, of provincial governments. Let them use the revenue for the purposes of operating their government.

The second reason I have been an advocate for this legislation is the potential it has for creating employment. Obviously it would create a substantial amount of revenue for provinces, but in addition, we ultimately would see some of that as jobs are created at the federal level.

As recently as September, the Canadian Gaming Association, which has a number of gaming groups around the country as part of its association, did an economic analysis of what would occur if this were allowed to become law in Canada and we could have this type of gaming going on. It is of particular interest to me because the city of Windsor is the host of one of the largest casinos in the country; I think it is the largest, but there may be one or two of the same size.

The estimate was that the number of additional jobs or the securing of existing jobs in the Windsor casino, just that one casino, would be somewhere between 150 to 250. Some jobs would be saved because there have been some layoffs recently because of competition that we are getting from the U.S. side and just because of the general economic downturn that we have had recently, but we would secure those jobs or create new jobs.

The association did a similar analysis for the casinos, interestingly, in Niagara Falls, the home riding of the Minister of Justice, and came up with a similar number of jobs being secured or jobs that would be created. That is true across a number of other areas in Ontario and elsewhere in the country.

There is a very strong reason from that vantage point, not only the revenue that this would create for the provinces but, more specifically, the jobs it would create at the lower level.

I have spoken to some of my colleagues who have charity casinos in their ridings. They feel that a similar impact would occur. A number of these are situated along the U.S.-Canada border, and we draw a lot of trade from the U.S. side. For instance, in the casino in Windsor, the estimates continue to run that somewhere between 75% and 80% of the revenue comes from the U.S. side of the border. That is true even for some of the charity casinos. It is certainly true for Niagara.

The important part is that allowing for this type of gaming would attract tourist trade into Canada. People would come over. I always tell the story that I happened to be in Las Vegas when one of the national basketball tournaments was on. I remember sitting in Caesars, actually on the floor with all these students who were watching the game, knowing that they had placed bets on the game. That is the kind of tourism we would be attracting on our side of the border.

Let me indicate the support that we have had. I have already indicated that both the Province of Ontario and the Province of British Columbia have sought this amendment from the federal government. A number of municipalities, including the City of Niagara Falls and the City of Windsor, the Canadian Gaming Association, the Saskatchewan Indian Gaming Authority, the Atlantic Lottery Corporation, the Nova Scotia Gaming Corporation, the Ontario Lottery and Gaming Corporation, and the Saskatchewan Gaming Corporation have all indicated their support. They have an appreciation from working in this field and this part of the economy of what the consequences would be and are quite supportive that this would go ahead.

I will summarize the reasons for supporting this bill. It would be a blow against organized crime and a potential job creator for the economy. As well, it would move additional revenue into the hands of the provinces. It is a very simple amendment. It does not require a great deal of understanding of what we are doing or why. I would encourage all members of the House to support this bill.

[Joe Comartin, NDP, Windsor—Tecumseh, ON]

moved for leave to introduce Bill C-290, An Act to amend the Criminal Code (sports betting).

Mr. Speaker, this is a very simple bill, matching the personality and character of the person moving it.

It is simply a repeal of one very small section of the Criminal Code. Its effect would be to allow for sports betting on single sporting events in this country.

This is a very important bill from this perspective. That industry is very big, and it is entirely controlled by organized crime at the present time, both here and in the United States, because it is generally illegal in the United States to bet on one sporting event.

The estimate in the United States is that $30 billion a year is bet on that, all going into the pockets of organized crime and some of it offshore. It is estimated that as much as $2 billion is spent in Canada annually, with all of that money going out of the country to organized crime syndicates in the U.S. and the Caribbean, so it is quite important that we move on this.

The other thing is that there is a national gaming association in Canada. It just completed a study that shows the employment that would be created by making this into a legal business. For instance, in Windsor there will be another 150 jobs either saved or added to the current employment in the Windsor casino. In the riding of the Minister of Justice there is a casino, and a similar number of jobs would either be saved or added. It is job creation.

The Province of Ontario has signalled that it is very interested in placing this operation in the casinos in that province. Other provinces are taking different perspectives on it, but there is widespread support for this bill, and I am seeking support from all members of Parliament when it comes up for second reading.

(Motions deemed adopted, bill read the first time and printed)