DraftKings And FanDuel End Daily Fantasy Competitions In Ontario Before Online Sports Bettin


Ontario’s proposed online sports betting market could cause some liquidity problems for daily fantasy firms as two major operators refrain from offering DFS within the province’s regulatory framework.

Daily fantasy sports as Ontar residents know is on the brink of disruption as the province’s new online betting market may be more hospitable to OSB than DFS.

Bookmaker and Daily Fantasy Sports (DFS) operator FanDuel has said it will no longer be able to offer free or paid DFS competitions in Ontario effective April 1 “due to a change in government regulations.” FanDuel added that entries submitted before April 1st will be processed as usual and all winnings are cashable.

The deadline comes just days ahead of the April 4 opening of a new market for internet-based casino gaming and online sports betting in Ontario. FanDuel was one of more than a dozen operators willing to participate in this market starting Monday morning.

“Ontario residents can participate in daily fantasy competitions while physically located in other provinces and in US states where daily fantasy is allowed,” a FanDuel support article says. “In addition, Ontario residents will be able to take advantage of FanDuel’s sportsbook and casino products, which will launch in Ontario starting April 4.”

FanDuel’s main competitor, DraftKings, also plans to launch online sportsbook (OSB) in Ontario next month. According to a statement from DraftKings’ customer service department, the company will shortly be retiring its DFS offerings in the province.

“Following our launch of sportsbook and iGaming, customers who are physically located in Ontario are not eligible to participate in paid or free Daily Fantasy Sports competitions,” the statement said. “However, you can still play on DraftKings if you are in other Canadian provinces or US states.”

DraftKings’ website says its online sportsbook and casino will be available in Ontario in April. Until shortly before that, customers in the province can take part in the company’s DFS competitions.

An illiquid situation

Canadian Gaming Association President and CEO Paul Burns said there are two main issues regarding DFS in Ontario, Canada’s most populous province.

One problem is that DFS has been included in regulatory standards as a gambling product, forcing operators who want to offer daily fantasy competitions to charge a $100,000 license fee each year and a 20% share of their revenues to the province to deliver. This could discourage smaller, “pure” DFS operators.

The other, bigger problem is that no “liquidity” is allowed in the province’s new, regulated market, Burns said. This is a change from the current market, which is not provincially regulated.

“So you can’t ‘mix’ players from other jurisdictions with Ontario players,” which affects both DFS and other pooled products like poker, Burns said in an email. “There are unresolved legal issues related to international liquidity in Ontario that we [hope] will be resolved in the coming months. This is the biggest obstacle to DFS’ offering.”

Despite this, the Ontario Alcohol and Gambling Commission (AGCO) says a key goal of the province’s new iGaming market is to bring sites that already offer gambling to Ontario residents under provincial regulation. In Ontario, the regulator told Covers, “pay-to-play” fantasy sports are considered a form of gambling and are allowed by AGCO’s iGaming standards.

“At this time, Ontario players can only participate in games with other players who are located in Ontario,” AGCO’s communications team said in an email. “Deciding whether or not to offer pay-to-play fantasy sports is an individual business decision that rests with registered operators. Free-to-play fantasy sports have been and will continue to be allowed to be offered following the launch of the new iGaming marketplace on April 4th, 2022.”

A DFS loss, a sports betting win

Loss of DFS Options in Ontario could come as new avenues for internet-based gambling open up.

Ontario’s iGaming market, scheduled to launch April 4, will allow commercial online sportsbook operators and casinos to legally offer their games in the province. The only company currently able to do this is the state-owned Ontario Lottery and Gaming Corp.

At least 30 operators have applied to join the new market as Ontario’s sizable population and plans to allow both online sports betting and casino gambling have proved popular with bookmakers. Ontario is also the only province in Canada that is publicly planning such a move.

As of Monday morning, 15 non-OLG companies had received iGaming operator registration from the Ontario Alcohol and Gambling Commission, a key approval required to participate in the provincial framework.

Operators must also enter into an operating agreement with iGaming Ontario, a government agency and AGCO subsidiary. If this is the case and all other regulatory conditions are met, new online gambling companies could legally start operating in the province as early as April 4th.

“To complete these steps, these organizations must meet strict standards related to gaming integrity, fairness, player protection and social responsibility,” said iGaming Ontario website says. “Their websites will have controls to prevent underage access and have measures in place to enable more responsible gaming. They have legal arrangements in place to ensure compliance with applicable laws, including anti-money laundering.”

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