New legislation outlines compliance requirements for online operators in Canada

2014-07-04

Reading time 1:26 min

(Canada).- The strengthened legislation, introduced by Canada's Minister of Finance in February to the 2014 Canadian federal budget, was intended to bring Canada federal compliance in accordance with international standards. Further legislation was introduced at the end of March, Bill C-31 of the Economic Action Plan, to introduce further provisions heightening compliance.

Law highlights:

Virtual Currency

Proposed measures included in the amendment include bringing individuals engaged in virtual currency under the jurisdiction of the Act (Bitcoin, etc.), and all individuals or businesses not based in Canada who serve Canadian users/customers using virtual currency.

Online Casino Jurisdiction Includes Information Sharing

“Online casinos” are specifically mentioned as falling under the new jurisdiction of the scope of the Act.

The Act also cites private policies regarding the sharing of information, which has the most direct relation to the anti-terrorism and anti-money laundering rationales, regulating “...the exchange of information between certain reporting entities and their affiliates (including both domestic/foreign affiliates), for the purpose of detecting/deterring money laundering offences or terrorist activity financing offences or for the purpose of assessing the risk of such an offence.”

Tracking Foreign Transactions

This is not a questioning of the integrity of casinos, but a regulatory measure to track the ultimate origins and destination of monies exchanged online, with particular vigilance for foreign transactions, which any non-Canadian casino operating in Canada or serving Canadians represents.

Discretionary Power for Finance Ministry

The Act also includes what it calls a “discretionary power” for the Minister of Finance, which empowers the Minister to directly direct any entity operating under the act to provide whatever information the Ministry request or bring their operations into further compliance as directed by the authority that the Finance Ministry represents.

Online Casinos: Comply and Enjoy Revenues

These new laws, which include further reporting regulations, put the onus on all online casinos to familiarize themselves with the new responsibilities that they will be subject to in accordance with the tenets of this new legislation.

The good news is that this small adjustment required on the part of casinos will lead to unfettered and unobstructed service of the Canadian population, and the protection of the

Canadian government to operate freely in delivering the online gaming market to as wide a Canadian base as possible.