Ladbrokes Canada Pull-Out is an Individual Decision

Published October 8, 2014 by Lee R

Ladbrokes Canada Pull-Out is an Individual Decision

Ladbrokes was not sufficiently vested in the Canadian market to maintain operations in the new Canadian online gambling environment, but others are.

What seemed to be a halting trend to online gambling in Canada is really just a minor sputter. The apparent trend was initiated with the withdrawal of operators Matchbook and Bet Fred and payment processor Skrill from the Canadian market last year and followed the Ladbrokes Canada announcement that customers could no longer play there and had to withdraw funds by October 1st.

The Scope of Canadian Regulation

Government agencies run legal lottery corporations and racing commissions in Canada, but there is no language in Canada law addressing (or prohibiting) offshore gambling or betting per se. Quebec's first nation reserve of Kahnawake even hosts offshore gambling servers.

As it stands, current Canadian law prohibits offshore gambling companies from advertising real money products and related products. To stay under the radar and continue limited operations uninterrupted, online operators such as Bet365, Bodog, Betfair and most recently PokerStars have ceased advertising their products in Canada.

Ladbrokes: Business Decision not Regulation Issue

In this new climate, Ladbrokes' withdrawal from the Canadian market avoids the hassles of proving the new UK Gaming Commission (UKGC) requirement that the company doesn't bring in more than 3% of its total revenue from Canada, which would otherwise leave the company open to regional taxation as well as increased scrutiny and government impediment to the business activities of Ladbrokes' Canadian branch.

Since Ladbrokes in reality only garners about .5% of its revenue from Canada, it was much more prudent for Ladbrokes to shut down its Canadian operations and avoid the scrutiny and tax requirements that might otherwise rock the boat for all remaining gambling operators in Canada.

Other Operators Remain

Other UK companies such as Bet365, William Hill and Betfair have a more significant Canadian presence, so they will not be summarily withdrawing in the same manner as Ladbrokes Canada, and will be adapting to the tax regulations of the crown to maintain their larger operations in the Canadian environment. Suffice to say, the withdrawal of Ladbrokes from the Canadian market should not be seen as an industry-wide trend or regulation issue, but merely common financial prudence on the part of one market operator with insignificant holdings in the Canadian market.

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