Kahnawà:ke’s Historic Gaming Industry Threatened by Proposed Canadian Gambling Bill, S-268

A new Canadian gambling bill intended to enshrine First Nations’ right to gaming on their own land could dismantle the Mohawk Nation of Kahnawà:ke’s decades-old online gambling industry. Alberta Senator Scott Tannas is the bill’s sponsor.

First Nations are themselves split on the bill. S-268 received glowing endorsements from Alberta and Saskatchewan-based Indigenous leaders at a June 20 press conference. However, Mohawk Council of Kahnawà:ke (MCK) chief Mike Delisle Jr. told Bonus the proposed legislation falls far short of what MCK is hoping for in terms of self-determination:

Based on our preliminary review, it doesn’t even come close to what we were looking for, not only in terms of a carve-out but in terms of jurisdiction.

As you’re aware, Kahnawà:ke will never sign on with the province being in control. Or even the ‘conduct and manage’ model similar to what Ontario did. We’re looking to have our jurisdiction recognized… This bill talks of minimum bets, maximum bets, bingo and type one gaming, and so on. And that’s not what we’re looking for at all.

Tannas Says S-268 Puts First Nations on Equal Footing

Bonus also spoke with Tannas, who said his proposed legislation aims to empower First Nations.

As written, he said, S-268 will add an exception to the criminal code that, at its simplest:

Puts indigenous governments with respect to gaming in the same position as the province. As opposed to being regulated by the province the way it is now.

He also highlighted other features of the bill, such as the ability of Indigenous governments to form a joint gaming commission if they wish to do so.

Bill S-268 also has a clause that “effectively allows each community to decide whether or not they want to take up this right.”

Should the bill pass, Indigenous communities would have to opt into the new system, said Tannas. First Nations communities that don’t want gaming in their community can choose to leave it under the province’s jurisdiction.

However, there are also worries that the new law might impact existing revenue agreements between Indigenous bodies and some provincial governments. Exactly how and to what extent might only become apparent after the bill passes, if it does.

Tannas dismisses those concerns, insisting that S-268 would shift power to First Nations communities:

That’ll be up to the indigenous communities that have actual revenue agreements with the provinces. And every province is different.  But it [S-268] will put the negotiation power between the First Nation and the province back in the hands of the First Nation…

They can do their own thing. It’s their money, it’s their business, and it’s their sovereignty.

Kahnawà:ke Sovereignty, Jurisdiction at Stake

Chief Delisle doesn’t see it that way. Maintaining Kahnawà:ke’s long-established sovereignty is at the heart of the Nation’s refusal to support Bill S-268 in its current form.

Last week, in an interview with Gaming News Canada, he struck a defiant tone:

We’re the rogue First Nation across Canada, and we’re certainly the most stubborn.

In the same interview, Delisle said Kahnawà:ke isn’t backing down.

We are working with people on the hill to engage with Senator Tannas and to see if (the bill) can be a wider-eyed approach instead of it being provincially bound.

Last November, MCK initiated legal action against Ontario after being shut out of that province’s newly privatized online gambling market.

Until recently, and for over two decades, MCK’s wholly-owned online gambling operator, Mohawk Online (MO), had served Ontarians. During the same timeframe, the Kahnawà:ke Gaming Commission (KGC) regulated many of the world’s gambling operators.

But with Ontario’s commercial expansion of online gambling, Mohawk Online had to pull its site, Sports Interaction (SIA), from the province.

Confusingly, another iteration of SIA reentered Ontario shortly after MO’s departure.

However, Electraworks Maple Limited, a wholly-owned Entain subsidiary, runs the Ontario site. Entain gained control over SIA when it purchased Avid Gaming in 2022. Previously, MO had exclusive rights through Avid to the SIA brand.

MO, a socio-economic initiative that reinvests profits in the community, still operates Sports Interaction in other Canadian provinces. However, it can no longer accept Ontario players without being regulated by and paying taxes to the province.

Additionally, KGC-regulated operators (and their suppliers) have reportedly received notifications from the Ontario regulator warning that doing business with KGC get them blocked in the province.

Deslisle estimated these changes cut MO revenues by over 50% since exiting the Ontario market.

One fear is restricting Indigenous gaming rights to provincial boundaries, as S-268 would, will further throttle Kahnawà:ke’s once-thriving gaming industry.

Full Impact of Bill S-268 Remains Unclear

When it comes to online gambling, there is the additional issue that Canada’s existing gambling laws predate the internet and don’t address the possibility at all. In speaking with Bonus, even Tannas seemed vague on his bill’s implications for online gambling.

When asked, hypothetically, if a Nova Scotian player could play on a site run by a First Nation located in Alberta, he pointed to the continued legal ambiguity around Ontario’s market:

It’s a little bit grey at the moment. The same way it is for the provinces. Ontario has been big with sports betting and advertising across the country.

Under Canadian law, provinces and territories can only legally conduct and manage gaming within their borders. This restriction means only players physically located in Ontario can access the province’s regulated sites. However, many of the same operators serving Ontario legally continue to serve other provinces in a gray market capacity. Even those without legal status in Ontario can place their brands on national television by advertising play money dot-net sites that funnel players into their real-money operations.

The issue of Ontario-focused ads seeping across provincial boundaries is partly a consequence of national broadcasters failing to geotag ads appropriately. Media buyers’ ignorance of which operators are legal in which provinces (or not) also plays a role.

Tannas reiterated that S-268 aims to ensure First Nations have the same powers as the provinces. However, provinces can only offer gambling inside their borders. If First Nations would face similar restrictions, it’s unclear whether they’d be subject to provincial borders or those of their own lands.

Either way, passing S-268 could choke out much of what’s left of Kahnawà:ke’s online gambling industry if it results in a loss of national market access.

For Kahnawà:ke Bill Just Doesn’t Make Sense

To Delisle, Bill S-268, in its current form, is short-sighted.

Instead, Canada should unify gambling legislation while including a carve-out for First Nations territories. Anything else, he said, “just doesn’t make sense.”

The internet, he said frustratedly, is worldwide:

We’ve been doing it since 1999 without any legal challenge, provincially, federally, or in any way.

What’s hardest to understand, said Deslile, is the lack of movement on an earlier offer from the Canadian government to address the mistakes made in 1985. That was when the federal government delegated authority over “lottery schemes” to the provinces but left First Nations out. Nothing has been done despite the government’s expressed interest in the long-overdue conversation.

According to a report from APTN, federal Justice Minister David Lametti had indicated that First Nations would receive legal recognition next time Parliament amended the criminal code.

However, First Nations were again left out when changes permitting single-event sports betting passed in 2021. On the other hand, protection for Canada’s parimutuel horse racing industry was tacked on to the sports betting bill by the Standing Committee on Justice and Human Rights.

Such actions are why Kahnawà:ke doesn’t ask or wait for recognition, Delisle told APTN; they exercise jurisdiction.

We’ve done it successfully to the tune of hundreds of millions over the course of 20+ years. Yet Canada and Ontario have now finally, in their opinion, found a way to shut us out.

We’ve done two presentations to two standing committees previous to the amendment of Criminal Code stating what this will do to us, not only financially but more important jurisdictionally, yet falls on deaf ears.

In addition to S-268, MCK is concerned other provinces will follow Ontario’s lead in allowing commercial regulation.

If that happens, it’s another way to shut MCK out of the Canadian online gambling market, Delisle said.

We’re really hanging by a thread here in terms of protecting the jurisdiction, and we’re not giving up, thus the fight.

Tannas “Happy to Chat,” Kahnawà:ke Makes New Plan

With its jurisdiction at stake, MCK is preparing its challenge against Ontario, which first heads to court in early 2024.

However, Delisle said a legal battle was not MCK’s preferred action:

We didn’t want to go into a foreign government’s court, but we had no choice at that point. What other steps could we have taken?

As for Bill S-268, Senator Tannas told Bonus his team is willing to talk to anyone seeking to improve the bill’s impact on Indigenous communities.

Considering whether the bill will pass, Tannas believes those backing it have a “fighting chance.” Plus, if Parliament dissolves, the bonus to starting in the Senate is “we’ll all still be there,” he said.

In that case, the plan would be to reintroduce the bill again in the next session. But ideally, for its backers, 268 will make it through committee and out of the Senate by next Spring.

Ultimately, Tannas thinks uncoupling the casino business on Indigenous lands will lead to innovation in the industry. Over the following months, the bill’s backers will seek support in Parliament and impacted communities. He urges anyone interested to reach out, saying he’d be “happy to chat.”

Unfortunately, Delisle said he’s heard that before from other government officials. He stated bluntly that Canada should stop using words like “truth and reconciliation” if it doesn’t understand what they mean or is unwilling to follow through.

He described First Nations gaming rights as “a blatant example,” staring the country in the face.

MCK, for its part, will soon spend a day discussing gaming industry strategies with its partners and stakeholders.

The intention, Delisle said, is to emerge with a new plan of action.

There are certain things that were promised and never fulfilled. So now we need to re-circle the wagons and come back out on the offensive.

About the Author

Robyn McNeil

Robyn McNeil

Robyn McNeil (she/they) is a Nova Scotia-based writer and editor, and a lead writer at Bonus. Here she focuses on news relevant to online casinos, while specializing in responsible gambling coverage, legislative developments, gambling regulations, and industry-related legal fights.
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