• The Ontario Court of Appeal has ruled (4-1) that residents can legally play online games with participants outside Canada.
• The decision validates the province’s argument that cross-border liquidity improves safety by channelising players to regulated sites.
• Chief Justice Michael Tulloch stated the move reduces risks like fraud by bringing gaming under “protective regulation.”
• Seven other Canadian provinces opposed the move, arguing it could drain players from their own lottery-run monopolies.
• The ruling is a major boost for poker and Daily Fantasy Sports (DFS) operators, who rely on large international liquidity pools.

Court Clears Path for International Liquidity

The Ontario Court of Appeal has issued a landmark ruling that permits residents to legally participate in online games with players located outside of Canada. The 4-1 decision, delivered in response to a reference question from the provincial government, removes the primary legal barrier to cross-border liquidity.

Chief Justice Michael Tulloch authored the majority opinion, confirming that Ontario’s plan complies with the Criminal Code. The court reasoned that as long as the operator conducting the game is regulated by Ontario, the location of the other players does not render the scheme unlawful.

“Allowing Ontario to regulate players within its borders who wish to play online games against players outside Canada advances public safety by bringing such gaming under protective regulation,” Tulloch wrote. He noted this approach reduces risks such as fraud and addiction by offering a regulated alternative to the black market.

Solving the ‘Ring-Fencing’ Problem for Poker

Since its launch in 2021, iGaming Ontario (iGO) has operated a “ring-fenced” market. This meant Ontarians could only play peer-to-peer games, such as poker and daily fantasy sports (DFS), against other people physically located in the province.

While effective for casino games, this segregation was detrimental to poker and DFS, which rely on large player pools (“liquidity”) to offer attractive tournaments and prizes. The previous rules forced professional and high-volume players to continue using offshore sites to access global player bases. This ruling effectively dismantles that barrier, paving the way for Ontario-licensed operators to pool their Ontario players with international networks.

Provincial Opposition and Future Appeals

The decision was not without controversy. Seven other provinces-excluding Alberta and Quebec-formally opposed Ontario’s plan. The Canadian Lottery Coalition, representing provincial lottery monopolies, argued that this model would draw players away from their jurisdictions and onto platforms they do not control.

Critics also raised concerns that Ontario was effectively aligning itself with international operators that may be considered “grey market” or illegal in other parts of Canada. The province of Ontario rejected these claims, arguing that its priority is the safety of its own citizens.

The opposing provinces now have 60 days to seek an appeal to the Supreme Court of Canada. The Canadian Lottery Coalition has stated it is reviewing the ruling but has not yet confirmed its next steps.

Economic Implications and Market Growth

The ruling is expected to have a tangible economic impact. Ontario projects iGaming revenue of $253 million for the 2025-26 fiscal year, a figure that has nearly tripled in three years. By allowing international liquidity, the province aims to capture the estimated 20% of Ontarians who still gamble on unregulated offshore sites specifically to access larger games.

Legal experts and the Canadian Gaming Association (CGA) have welcomed the decision. CGA President Paul Burns commented, “This decision is a significant victory for Ontario consumers who enjoy pooled gaming activities like poker and DFS. It will bring back valuable options for players and increase the appeal of regulated platforms.”

Expert Analysis: Liquidity is King in the Fight Against Offshore

This ruling is a pivotal moment not just for Ontario, but for the global philosophy of online gambling regulation. For years, the “ring-fencing” model (used by countries like France, Spain, and Italy) was seen as the standard for strict regulation. However, it failed to kill the black market because it broke the fundamental mechanic of poker: liquidity.

If a regulated site offers a $10,000 prize pool and an unregulated offshore site offers $1 million, players will choose the offshore site every time. The Ontario Court of Appeal has recognised this commercial reality. By allowing cross-border liquidity, Ontario is finally giving its licensed operators the “ammo” they need-massive player pools-to genuinely compete with offshore giants.

This puts significant pressure on other Canadian provinces. The “monopoly model” defended by the Canadian Lottery Coalition now looks increasingly isolated. If Ontario players get access to global poker tournaments safely and legally, players in British Columbia or Saskatchewan will inevitably demand the same, potentially forcing a national modernization of gambling laws that is long overdue.