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  • Writer's pictureSean O'Hagan CEO Tap 5050

Computers are invading Canadian Raffles and Lotteries

The Canadian lottery industry had been held at bay by an obscure clause in the criminal code know as clause 207.4. The clause was originally added in 1979 and amended once in 1984. The clause stated that “computers cannot be used in the conduct and management of lottery schemes”.  Different provincial regulators interpreted the clause more or less leniently than others. Over time, as computers took over our lives, the various regulators started allowing for the use of computers in the lottery arena. The Ontario regulator, the Alcohol and Gaming Commission of Ontario (AGCO) held fast to their long-standing stance of “no computers”. In 2012 exceptions were made for the OLG and online games were introduced.

Alongside the provincial activity, the charitable lotteries were starting to ask “what about us”? The charitable lottery industry had been stagnant for many years with no new games or advancements to keep people interested. Their longtime supporters were aging and new purchasers weren’t entering the market. With customers changing buying habits and their demand for charities to be more cost-effective, the current formula was no longer working.

The industry needed to change to stay relevant and profitable.

In 2007 the AGCO formed a modernization committee. The charitable organizations running lotteries known as Mega-Raffles (games with prize pools of $1 million or greater) were asked to join the modernization process. Between 2007 and 2013 some advancements were made. A pilot project to allow for on-line tickets sales was implemented. A new 50/50 add-on game was approved but there was still a long way to go. The charities were not able to send e-tickets or receipts, draws were still done manually, all communication had to be sent by mail. All paper-heavy and expensive processes.

In 2013 the Mega-Raffle Committee in Ontario made a decision to try and have the Canadian criminal code amended to allow for the use of computers in the sale, management and draw processes for charitable lotteries. Lead primarily by Heart and Stroke and the Canadian Cancer Society a lobbyist was hired and the process started. Many on the committee believed it to be an uphill battle and the feeling was it would take years to come to fruition.  In my opinion the charge was led by Janice Gray, the lottery manager of the Canadian Cancer Society.

In order for the amendment to be considered the committee needed a member of parliament from each province to endorse the request. The lobbyist, with the help of the government liaisons from two of Canada’s biggest not-for-profits, made short order of getting the endorsements. Within the year the amendment (bill C-53) was attached to the federal budget for 2014. If the budget passed, the amendment went with it! The charities were asked to present their case to the Finance Sub-Committee in November 2014. Tom McAllister, CEO of Heart and Stoke at the time and Janice Gray represented the Canadian charitable lottery industry at the meeting. Ontario Lottery and Gaming was also invited to present as they concern with the charities entering the online gaming arena.

In January 2015 the budget was passed and bill C-53 was a reality. All provincial regulators now had to re-write their regulations that excluded the use of computers. While the regulators are catching up it’s a bit of the wild west in the online world of charitable lotteries. Still, things are certainly looking up in Ontario. The Canadian Cancer Society was able to use e-ticketing and receipting for the first time this fall of 2016. RNG’s are on the horizon for draws, online gaming will likely happen in the next year as the rules are re-written.

The moral of the story is – Don’t be afraid to try and change the status quo. Everyone assumed it would be impossible to change the criminal code and left it at that. In reality, the whole change happened in less than two years and the charitable lottery industry in Canada has a bright new future. Contact me for more information on how your favorite charity can benefit.

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