Sunday, December 17, 2006

The Province of Ontario has passed new consumer protection legislation that
contains provisions prohibiting the advertising of Internet gambling sites.
The provisions underwent important changes at committee (first reading,
second reading after committee), however, so that the final bill looks
somewhat different from the one that was introduced in the fall. When first
introduced, the bill contained a blanket prohibition on advertising an "an
Internet site that operates an internet gaming business contrary to the
Criminal Code." The bill defined advertising as: (a) the promotion by print,
publication, broadcast, telecommunication or distribution by any means, of
information intended to promote the use of an internet gaming business, (b)
self-promotion and a contract under which one person obtains the services of
another to develop or distribute the advertisement, (c) a link in a website
intended to promote the use of an internet gaming business.
After committee, the bill contained some important changes. While the
blanket prohibition remains unchanged, the definition of advertising has
been narrowed to instances where the advertising originates in Ontario or is
primarily intended for Ontario residents. The effect of this change will be
to exclude the vast majority of Internet gambling advertising, which neither
originates in Ontario nor is primarily targeted at residents of the
province. Moreover, the prohibition against linking has also been narrowed
by excluding links "generated as the result of a search carried out by means
of an internet search engine." In other words, Google and other search
engines won't be liable for links to gambling sites generated through search
queries. So what gets covered by this law? Most Internet gambling sites are
unaffected, unless they specifically target Ontario with their advertising.
Instead, there are two obvious effects. Offline, it seems likely that
Internet gambling newspaper and radio promotion, common in some newspapers
and on sports radio stations, will disappear. Online, Internet search
companies and websites will likely refuse advertisements that target
Ontario. Such targeting may occur either by way of the promotion itself or
by using geo-identifying technologies. This law may also capture Ontario
bloggers and websites that focus on Internet gambling. Those sites won't be
able to feature Internet gambling advertising and may even face liability
for posting links to various gambling sites.