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Ontario report The AGCO ’ s position on hold -out operators
TRANSITIONING POST LAUNCH An entity that has not registered with the AGCO by Ontario ’ s launch date and continues to operate in the unregulated market runs a risk of having their registration rejected . As this market is the first of its kind in Canada and has only operated since April 2022 , it is difficult to speculate on how the AGCO ’ s registrar ’ s standards for gaming or other governing laws may be enforced .
To date , the AGCO ’ s focus has been on reviewing applications and working with applicants to ensure compliance prior to issuing a registration . However , once more applicants go live in Ontario ’ s regulated market , the AGCO and other Canadian enforcement agencies may invest in enforcement which could present an issue for grey market operators continuing to operate in Ontario in an unregulated manner .
This is again speculation as enforcement against unregulated entities has to date not been a primary focus of the AGCO since the launch .
AGCO ENFORCEMENT TO DATE AND GOING FORWARD On 5 October , AGCO updated its igaming standards , announcing that its transition period for unregulated igaming operators and suppliers will end on 31 October . The transition was intended to allow those within the unlicensed space to move into the regulated market without causing disruption to their Ontario customer base .
It seems the new standard will create an obligation for applicants to cease unregulated activities in Ontario themselves , as well as any agreements with third parties carrying out business in the unregulated market . In a September email also discussing the end of the transition period , the AGCO advised that “ any [ applicant ] who does not meet this standard ( once in force ) will be jeopardizing their eligibility to obtain or continue holding an AGCO registration .”
Crucially , enforcement action may also be on the cards for unlicensed operators . In announcing the new standard , the regulator said that “ as with any instance of non-compliance , the AGCO will take appropriate regulatory action against any registrant that does not meet this standard ( once it comes into force )”.
Ontario ’ s enforcement options against offshore operators are limited , however , as the province does not have jurisdiction to enforce its laws outside the province . Despite this , the AGCO has adopted an astute position with respect to those entities currently in the market in a regulated manner .
For those that did not cease operations prior to launch , the standards prescribe that registered applicants must cut any ties they may have with other entities still operating in Ontario ’ s unregulated market .
The AGCO monitors this regulation through the requirement of having applicants disclose their “ supplier list ” to an assigned AGCO investigator ,
Ontario report October 2022