Loto-Québec Annual Report - A limited share of the online gaming market after 14 years of operation

June 7, 2024

Loto-Québec recently submitted its annual report. Unsurprisingly, revenues are down, with Loto-Québec reporting gross online gaming revenue of $438 million.

At a time when Quebec is facing a record $10 billion budget deficit, Loto-Québec, with only 23% of the online gaming market, must meet the optimization requirements required of Quebec’s government-owned enterprises. An analysis of Loto-Québec’s revenues and its share of the online gaming market demonstrates that the government’s refusal to regulate the online gaming market, as in Ontario, is depriving the province of substantial tax revenue.

With nearly 75% of Quebec gamers choosing private gaming platforms, the Coalition is offering a concrete solution to help the Quebec government manage the budget deficit. Regulating private online gaming, which holds the majority of the Quebec market, would enable Quebec to benefit from additional royalties, estimated at an annual minimum of $230 million in an optimal year of operation. This would be in addition to revenue generated by the Crown corporation. Quebec cannot afford to be deprived of this income.

Revenue generated by a regulatory framework for the online gaming market could be reinvested in key sectors of the Quebec economy, such as health and education, to the benefit of all Quebecers.

In 2024, the Ontario Superior Court affirmed the model in place in Ontario for online gaming. This decision confirms the legitimacy of the Ontario model.

The Coalition believes that market regulation also requires the creation of an independent regulatory body to ensure that all gaming in Quebec is properly regulated, including Loto-Québec. An independent regulatory body is the norm in most G7 jurisdictions. Loto-Québec’s mandate is to contribute to Québec’s public finances, while overseeing the management of responsible gaming. The corporation is placed in a conflict of interest that cannot be ignored.

The creation of an independent regulator is supported by experts in the fields of responsible gaming and public health. To this end, Dr. Sylvia Kairouz, Research Chair in Gambling Studies at Concordia University, the Direction régionale de santé publique de Montréal, and the Institut national de santé publique du Québec have all issued recommendations in favour of the creation of an independent regulatory body in Quebec.

The Coalition is proposing a solution will enable Quebec to significantly improve its public finances, while ensuring that Quebec players have access to the same responsible gaming measures whether they choose to play with private operators or Loto-Québec.

What is the government choosing to do? Instead, it protects the monopoly of a government-owned enterprise and ignores the advice of public health experts and the clear preferences of gamblers who overwhelmingly choose to play with private operators. Quebec must act to regulate online gaming, to the benefit of public services and Quebec society.