Exploring the Impacts of Alberta's New Licensing Model on Gaming and First Nation Partners
In a move that could significantly impact the Canadian gaming industry, Alberta has announced its intention to follow Ontario's lead in adopting an open online licensing model forregulated gambling.This article examinesthepotential impactofthistransitionon the gaming industry andFirst Nationpartners.
Modernizing Alberta's Gaming Industry
At the 2024 Canadian Gaming Summit, Minister Dale Nally announced a new plan for Alberta's gaming industry, built around an open online licensing model inspired by Ontario's successful framework. Nally explained Alberta's model will be "very similar" to Ontario's but with some key adjustments.1 This significant shift in Alberta's approach is expected to draw in commercial operators, generate substantial revenue, and drive economic growth for the province.
In a significant departure from the current framework, the Alberta Gaming, Liquor and Cannabis Commission (AGLC) will not be responsible fo rregulating the new gambling market. This move is expected to provide a more streamlined and efficient regulatory environment, attracting commercial operators who may have been previously deterred by the AGLC's control over the market. Instead, the Justice Minister will oversee iGaming, allowing investors to maintain control over their data. According to Nally, "Private operators can come to Alberta and invest in the province, knowing they won't have to share their data with AGLC or Play Alberta."
Ontario's approach to gaming regulation has paid off, with iGaming Ontario (iGO) reporting a significant 72% increase in online gambling revenue, reaching $2.4 billion in its second year.2 Alberta, with its population of 4.8 million, has the potential to replicate this success. According to the AGLC 2023 annual report, the province's gaming industry achieved notable net sales of $1.91 billion, resulting in $1.43 billion in net revenue after deductions.3 This indicates a promising opportunity for Alberta to generate substantial revenue and drive economic growth by adopting a similar gaming framework.
First Nation Collaboration and Growth
Alberta's evolving iGaming market also presents a significant chance for First Nation groups to participate and benefit. In a mandate letter, Premier Danielle Smith emphasized to Nally that he must work with indigenous partners to "finish developing and implementing Alberta's online gaming strategy with a focus on responsible gaming and provincial and indigenous revenue generation." This collaboration aims to generate revenue for both the province and Indigenous communities, ensuring they are integral to the evolving gaming industry.
Alberta is home to five "Host First Nation" casinos, which operate in parallel to traditional casinos, with a separate licensed charity managing charitable casino events at each location. These Host First Nation casinos account for 28.7% of net slot sales and raised $73.3 million through charitable gaming events.4 In recognition of this partnership, the province allocates a portion of its revenue to the First Nations Development Fund, dedicating $137.9 million to support economic, social, and community development projects that benefit First Nation communities and members. While no public announcement has been made yet, the Alberta government is expected to engage in consultations over the summer. The goal is to enable First Nations to participate in the regulated gambling market alongside other land-based casino operators, without the restrictions faced by Ontario casino operators.
Next Steps
As Alberta moves forward with its regulated gambling market, it will be important to balance the needs of all stakeholders, including private operators, indigenous partners, and the province's revenue goals. With a thoughtful and inclusive approach, Alberta can create a thriving gambling market that benefits all parties involved. Gaming companies interested in entering the Alberta market should carefully review the new regulations and consider consulting with lawyers to ensure a smooth transition and successful operation.
Footnotes
1. https://www.gamingnewscanada.ca/p/canadian-gaming-summit-2024-what
2. https://igamingontario.ca/en/news/igaming-ontarios-fy-2023-24-full-year-market-performance-report
3. https://aglc.ca/sites/aglc.ca/files/aglc_files/2022%20-%202023%20Annual%20Report.pdf
4. Ibid.
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