BUSINESS

Canada telecom regulator rejects Quebec plan to IP-block gambling sites

TAGs: Bill 74, Canada, crtc, Loto Quebec, quebec

crtc-quebec-gambling-blocking-unlawfulCanada’s national telecom regulator says Quebec’s plan to block unauthorized online gambling sites is illegal.

Late Thursday, the Canadian Radio-Television and Telecommunications Commission (CRTC) released a statement commenting on the application filed in July by the Public Interest Advocacy Centre (PIAC) asking the regulator to formally repudiate Quebec’s IP-blocking plans.

In May, the Quebec legislature approved Bill 74, the omnibus legislation that would compel internet service providers (ISP) to block online gambling sites not specifically approved by the Loto-Quebec gambling monopoly to operate in the province.

Bill 74 sparked countless op-eds arguing that Quebec’s plan was unconstitutional, as telecom issues are considered to be under the federal government’s jurisdiction. Associations representing telecom firms launched a lawsuit in the Superior Court of Quebec arguing that they would be forced to bear the entire financial burden of blocking unauthorized sites.

The CRTC’s statement notes that it has previously provided guidance on the Internet traffic management practices (ITMP) of ISP, specifically that “an ITMP that led to the blocking of the delivery of content to an end-user would engage section 36 of the [Telecommunications] Act and, consequently, would require the prior approval of the Commission in order to be implemented.”

The CRTC goes on to say that its “preliminary view” is that the Act “prohibits the blocking by Canadian carriers of access by end-users to specific websites on the Internet, whether or not this blocking is the result of an ITMP. Consequently, any such blocking is unlawful without prior Commission approval, which would only be given where it would further the telecommunications policy objectives.”

And finally, the money shot: “Accordingly, compliance with other legal or juridical requirements—whether municipal, provincial, or foreign—does not in and of itself justify the blocking of specific websites by Canadian carriers, in the absence of Commission approval under the Act.”

The CRTC has opened up a 15-day window to allow interested parties to submit opinions on the subject. After digesting these opinions, the CRTC will issue its final opinion.

HEALTHY PROFITS
Quebec finance minister Carlos Leitao has previously expressed confidence that federal approval isn’t required based on his claim that the IP-blocking plan is intended to protect the health of Quebecers – by (allegedly) protecting them from the harms of online gambling – and health issues are under provincial jurisdiction.

But this ‘health’ claim came only after Leitao had informed the provincial legislature that the blocking was necessary to boost revenue at Loto-Quebec’s online gambling site Espacejeux.com, putting the province in the awkward position of attempting to protect consumers while simultaneously urging them to gamble online – but only with the right provider.

Furthermore, Leitao’s spokesperson claimed that the CRTC had been informed in advance of the IP-blocking plans. It now appears that Quebec didn’t stick around long enough to listen to what the CRTC had to say.

Bill 74’s gambling provisions have yet to be put into action, reportedly because of the length of time necessary to compile a blacklist of unauthorized sites, but Quebec expects to start implementing the system in early 2018.

Last month, Loto-Quebec released its fiscal Q1 earnings report, which showed Espacejeux.com’s revenue rising 21.6% to C$17.2m (US $13.2m). The site enjoyed gains in both online lottery sales (24.7%) and casino games (+19.3%).

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