The BCLC Revises Regulatory Laws After 20 Years

The British Columbia Lottery Corporation has announced it has completed revamping a document known as the Operational Services Agreement (OSA). The document is basically a lawbook governing how casino and gambling operators at large are expected to act within the province. The revision follows the ordeal in September when British Columbia Attorney General David Eby revealed evidence that a group of Chinese gamblers had been using a BC casino to launder money to the sum of millions of dollars.

While all the details of that issue have yet to be published, including evidence from a two-year private investigation, it’s clear that the British Columbia Lottery Corporation is looking to bring a new level of order to the gaming activity in the province.

Jim Lightbody, BCLC President and CEO, explained the process, saying, “The gambling market has evolved significantly since BCLC first took on the role of managing casinos in 1997. The new OSA sets the course for the long-term success of the industry in B.C. by working with service providers to create and commit to an investment plan and hold service providers accountable for those plans and for maintaining the security and integrity of gambling.”

In an official press release from the BCLC, the corporation made their view of the new structuring clear: “As the Crown corporation responsible for managing gambling in the province, BCLC will continue to determine where casinos and community gaming centres are located and contracts with private-sector companies to build and operate the facility. These private sector service providers earn commissions similar to a revenue share as a financial incentive for their investments in operating and growing the business.”

The basics of the revised OSA are quite clear. The BCLC states that it will continue to be the determining body with regards to the location and contract-type of gaming centres and facilities in the province. The new document also includes protocols for cases where operators fail to comply with current standards. This means a broader scope of responsibility for operators as well as a better defined “or else” scenarios.

The BCLC is of course in favor of gaming operators succeeding within the new ecosystem. The incentive given by the regulator to casinos and other operators that follow the new protocols is a 5% facility investment commission that will be tied to net winnings. The BCLC pointed out, however, that this incentive can be cancelled for operators who repeatedly fail to comply with the new regulations.

Part of the existing laws, the British Columbia Lottery Corporation emphasized that operators would continue to be obligated to a commission rate of 25% on slot net win amounts, as well as the 40% tariff placed on high-limit table games. For regular-limit table games, the amount will be set at 42.5%, and for poker it will rise to 77.5%.

The bingo sector has also been included in the newly revised protocols. For bingo, operators will be required to commissions on weekly revenue after prizes have been paid. This will be set out as 90% on the first $10,000 and 45% on any amount over $10,000.

The newly revised OSA agreement shows that gaming really is evolving in the province. While there is a need to regulate the gaming activity, it’s not always clear whether the factions involved are truly representing the public, or are simply interested in scraping away as much as they can from operators.

Of course, operators in the province won’t have a choice. The new OSA is a 20-year agreement and the BCLC will start approaching operators to sign the document in the near future.