THE STANDING SENATE COMMITTEE ON TRANSPORT AND COMMUNICATIONS
EVIDENCE
OTTAWA, Tuesday, October 1, 2024
The Standing Senate Committee on Transport and Communications met with videoconference this day at 9 a.m. [ET] to study Bill S-269, An Act respecting a national framework on advertising for sports betting.
Senator Leo Housakos (Chair) in the chair.
[English]
The Chair: Welcome to this meeting. I am Leo Housakos, a senator from Quebec and chair of this committee. I would like to invite my colleagues to briefly introduce themselves, starting on my left.
Senator Simons: Senator Paula Simons, Alberta, and I come from Treaty 6 territory.
Senator Cuzner: Rodger Cuzner from Nova Scotia.
Senator Quinn: Tim Quinn from New Brunswick.
Senator M. Deacon: Good morning. Marty Deacon, Ontario.
[Translation]
Senator Clement: Bernadette Clement from Ontario.
[English]
Senator Cardozo: Andrew Cardozo, Ontario.
[Translation]
Senator Miville-Dechêne: Julie Miville-Dechêne from Quebec.
[English]
Senator Dasko: Donna Dasko, senator from Ontario.
The Chair: This morning, we will continue our study of Bill S-269, An Act respecting a national framework on advertising for sports betting. For the first committee this morning, the committee welcomes Paul Burns, President and Chief Executive Officer, Canadian Gaming Association; and Catherine MacLeod, President and Chief Executive Officer, ThinkTV. We also have Kahlil Philander, Assistant Professor, School of Hospitality Business Management, Washington State University, who joins us by video conference.
We will first hear opening remarks, beginning with Mr. Burns, and then we will proceed to a period of questions and answers with my colleagues. Mr. Burns, you have the floor.
Paul Burns, President and Chief Executive Officer, Canadian Gaming Association: Good morning and thank you for the opportunity to appear before you today.
The Canadian Gaming Association, or CGA, is a national trade association representing 77 member companies who are the leading private sector operators and suppliers in Canada’s casino gaming and sports betting industries.
Gambling is a legal, regulated and socially acceptable entertainment choice for Canadians. Canada’s regulated gaming industry in 2023 generated $20 billion in revenue and directly employs over 100,000 Canadians in communities across the country.
I am here today to say that I don’t believe Bill S-269 is necessary, as most — if not all — of what the bill aims to do is currently in place.
Provincial management and oversight of gaming activity in Canada have created a world-leading commitment to responsible gambling, including comprehensive player education programs along with prevention and protection measures and research funding. Player education programs such as GameSense, created by the British Columbia Lottery Corporation, is used in several provinces as well as in the states of Oregon and Massachusetts and by MGM Resorts in North America. The commitment to build a strong culture of responsible gaming has been at the cornerstone of each province’s approach to its gaming framework since they took responsibility in the mid 1980s.
We have a very effective regime of advertising compliance thanks to ThinkTV and Ad Standards, who for decades have provided preclearance services to advertisers. Underpinning it all is provincial gaming regulators who set and enforce the regulatory standards of their provinces.
When Ontario became the first province to license and regulate online gaming, which includes sports betting, professional sports leagues and their broadcast partners became active stakeholders, and developing policies on how sports wagering could interact with their product. Each league placed restrictions and limits on advertising for players, teams and officials, both in-venue and on broadcasts.
There has been a great deal of emotional discussion about gaming advertising over the past couple of years because people have seen more of it. There has also been a lack of facts, data or understanding of the evolution of the Canadian gaming marketplace related to online gaming and why the actions that Ontario took to create a regulated marketplace was needed, welcomed and should be applauded.
Since the late 1990s — at the beginning of the internet — Canadians have had unrestricted access to unregulated offshore online casino gaming and sports betting — for 25 years. During that time, Canadians have been able to play casino games and bet on sports online using common payment tools like Interac or credit cards. Many of these offshore sites advertised on Canadian television and on the rink boards and fields of Canadian professional sports teams across our country.
Ontario’s regulatory regime for online gaming has some of the most robust regulatory standards in North America — if not the world.
There are more than 20 measures related to gambling advertising, including the overarching regulation that advertising, marketing materials and communications shall not target high-risk, underage or self-excluded persons. A few more pertinent examples are as follows:
Preventing minors from accessing online accounts with account sign up rules that are rooted in Canada’s anti-money laundering legislation for setting up gaming accounts. Verifying age, identity and location. Players must opt in to receive promotional emails from operators.
Prohibiting mass-market advertising of bonuses and incentives — something that is still permitted in the U.K.
Prominently promoting and making available tools to support responsible play, setting time, wager and loss limits and a range of time-out settings — from hours to days to months — as well as the ability to self-exclude. We’re looking forward soon to the creation of a province-wide, centralized self-exclusion for all residents of Ontario, regardless of where they choose to gamble.
After the first year of the market, the Alcohol and Gaming Commission of Ontario responded to public concern, reviewed their advertising standards and made additional amendments to restrict the use of athletes and tighten the definition of the appeal to minors.
The Ontario regulatory model brought over 85% of unregulated online play into a regulated regime in less than two years — something not replicated anywhere in the world and represents an effective framework of oversight and protection for all gaming advertising.
Provinces have the tools and are in the best position to regulate. An additional layer of federal regulation is not required.
In closing, I would like to share some data on online gaming advertising. This includes both online casino and sports advertising in Canada. It was provided to us by MEDIARadar and Vivvix Canada. It was commissioned by the Canadian Gaming Association, or CGA:
Compared to all other activities in Canada, online gambling has only represented 2% of all television ad occurrences in 2022 and 2023.
When compared to other key categories, online gambling represents 8% of total media ad spent.
Only 6% of NHL hockey game occurrences were for online gambling ads and 4% for NBA basketball game occurrences.
There is an overall 15% decrease in television ads spent during the last third of the year for the fall quarter of 2023 compared to 2022, during peak sports programming.
Thank you. I look forward to your questions.
The Chair: Thank you. Ms. MacLeod?
Catherine MacLeod, President and Chief Executive Officer, ThinkTV: Thank you. Good morning.
I’m Catherine MacLeod, President and CEO of ThinkTV. Thank you for the opportunity to be with you today to discuss our role in the Canadian broadcasting and advertising landscape, particularly the evolving online gambling sector.
Established in 1961, ThinkTV is a not-for-profit association representing Canadian private and public broadcasters. Our member companies form the backbone of Canada’s broadcasting industry, accounting for nearly 90% of the country’s commercial television advertising revenue.
Our organization focuses on two main areas:
First, marketing and research that highlights the value of commercial television advertising across all media platforms. Second, ThinkTV clearance, which is a central clearance hub for video advertising in both official languages across all television platforms, including linear broadcast television, broadcaster streaming services and online video. We also offer broadcaster audio gambling advertising clearance services and are expanding our services so that they are available to third-party video streaming platforms.
ThinkTV clearance plays a pivotal role in upholding broadcasting advertising standards in Canada. We ensure strict adherence to the Canadian Association of Broadcasters’ broadcast codes, which are not voluntary, but mandatory regulatory requirements for all television programming undertakings, as well as the Canadian Code of Advertising Standards and other legal and regulatory requirements. These codes ensure that advertisements are truthful, not misleading and do not cause serious or widespread offence or harm, especially to children and vulnerable populations. Please note that ThinkTV clearance does not review advertising that comes into Canada via U.S. conventional television stations like ABC, NBC, CBS or Fox, or authorized U.S. specialty services such as CNN, A&E or TLC.
In 2023, our expert analysts evaluated over 28,000 scripts and reviewed more than 37,000 pieces of video creative. We actively develop copy with our partners, working closely with agencies and advertisers from the initial script stage to the final production. This approach has proven especially beneficial in complex sectors like online gaming.
Since the launch of the regulated online gaming market in Ontario, we’ve been working hand in hand with iGaming operators, broadcasters, agencies and the Responsible Gambling Council of Ontario to ensure advertising in this sector meets both legal requirements and ethical standards. Our collaboration has been instrumental in ensuring compliance with the Registrar’s Standards set by the Alcohol and Gaming Commission of Ontario, or AGCO, as well as the broadcast codes.
In line with our obligations under the broadcast codes, we’ve introduced additional requirements for gambling advertising destined for broadcast. This includes mandatory inclusion of messages about seeking help for gambling concerns from ConnexOntario; all persons appearing in gambling advertisements must be, or appear to be, at least 25 years old; a prohibition against imperative-based language creating a sense of urgency, such as “bet now” or “play today”; and bans on advertising elements that exploit cultural beliefs about gambling, luck, or prosperity, including symbols and characters.
We believe the current flexible regulatory framework has enabled marketers to build their brands responsibly while attracting players away from illegal gambling operations. The AGCO has demonstrated its ability to swiftly amend standards when concerns arise.
Gambling advertising represents a small proportion of the overall advertising we review. In 2022, we reviewed 442 online gambling ads, dropping to 299 in 2023. As of last week, of the 28,000 video advertisements we reviewed in 2024, 189 of them are related to online gambling. We are forecasting ending the year with 60 fewer ads than we reviewed in 2023, which follows the typical pattern for new product launches in television advertising.
Our team of analysts review each piece of gambling-related content, assessing it against the broadcast codes, the Registrar’s Standards and other legal and regulatory requirements, before I provide a final review. Many gaming operators and their creative agencies have sought our guidance, and we’ve worked closely with them to improve their understanding and ensure compliance with the rules. These working relationships are particularly important because much of the video creative they submit has been used in other jurisdictions and must be edited to comply with our regulatory requirements.
We cannot underestimate the importance of the unique aspects of Ontario’s regulatory and media environment. Unlike jurisdictions such as the U.K., Australia and the U.S., Ontario prohibits promotional or incentive-based public advertising that encourages viewers with inducements like “free bets,” “sign-up bonuses,” or “no-loss” betting. Unsurprisingly, research confirms that this type of promotional advertising has a much more significant impact on vulnerable individuals than the brand awareness advertising currently permitted in Ontario.
ThinkTV and its member companies remain committed to fostering a safe, competitive and well-regulated environment for internet gaming that safeguards minors and vulnerable individuals. We encourage the Senate committee to consider the unique aspects of the Canadian and Ontario markets and to base any future changes on the results of comprehensive, Ontario-specific research, reflecting the impact of our current advertising regulatory framework for youth and the vulnerable.
Thank you very much for your time.
The Chair: Thank you, Ms. MacLeod. Professor Philander, you have the floor.
Kahlil Philander, Assistant Professor, School of Hospitality Business Management, Washington State University, As an Individual: Thank you for this opportunity. I am an associate professor at Washington State University. I have been a researcher in gambling studies since 2009, when I first moved from Canada to complete a doctorate studying gambling at the University of Nevada, Las Vegas. Since then, I have worked as the first Senior Policy Researcher at the Responsible Gambling Council of Canada in Toronto and later as the Director of Social Responsibility at the British Columbia Lottery Corporation where I oversaw all of the responsible gambling programs in casinos, lottery, online gaming and sports betting in British Columbia, before returning to academia in my current position.
I submitted to the record a recent study that I led in collaboration with analysts at the leading sports betting and online gaming consultancy, Eilers & Krejcik Gaming, co‑authored by a researcher from the largest academic gaming centre, the International Gaming Institute at the University of Nevada, Las Vegas.
First, we found that the evidence clearly supports the implementation of frameworks and interventions that can help protect vulnerable populations, for example, adolescents and young adults, and those who may already be identified as at risk of gambling problems. I’m sure that’s nothing new relative to the testimony that you have already heard. However, beyond those conclusions, our review led to a few important insights that we view as relevant to your decision making.
The first is the limits of empirical research. It’s essential to acknowledge the inherent limitations in the current body of empirical research on gambling advertising. Despite prevalent assumptions and claims by well-credentialed researchers, the evidence linking gambling advertising directly to gambling problems is largely non-causal. There’s a notable risk of reverse causality, that is, correlations from individuals with gambling problems who are more likely to recall seeing gambling advertisements. This complexity suggests that while advertising can influence gambling behaviours, the scale and nature of this influence remains poorly defined by the limitations of existing research.
Second, Ontario is uniquely equipped with robust institutions and intellectual resources dedicated to addressing gambling-related issues. The province is home to pioneering regulatory bodies, esteemed non-profit organizations and numerous researchers focused on gambling studies. As I mentioned, I personally started my own postdoctoral career at the Responsible Gambling Council in Toronto, and two of my active co-authors are nearby at Carleton University.
However, in sports betting and online gaming, a significant gap in our understanding stems from the underrepresentation of Canadians in the global literature. Most studies emanate from the U.K. and Australia in our review. While these countries may seem culturally similar, their market structure and history with gambling is fundamentally different from the Canadian marketplace. To evolve Canadian gambling policy in an effective way over time, it is essential that Canada invest in its researchers and research institutions.
Third, in terms of regulatory standards, we found that Ontario’s rules are on par with the world’s leading jurisdictions. They certainly reflect the expertise that exists in the province and the decades of learning from other jurisdictions’ experiences. When we observed differences in marketing policy during our review, they typically reflected cultural preferences rather than distinctions in evidence-based standards.
Finally, to speak a bit more broadly than the focus of our report, it is entirely foreseeable that any jurisdiction launching a multi-billion dollar gaming industry would have some growing pains in the first couple of years. We commonly refer to this phenomenon as the “exposure effect” in the literature. But I would encourage you to consider the deep expertise in the world-class institutions that exist in the province and how any legislation would either limit them or empower them to make decisions that give discretion to their expert judgment.
I appreciate your attention to my report and these findings, and I am pleased to answer any questions you may have.
The Chair: Thank you, Professor Philander.
[Translation]
Senator Miville-Dechêne: I was hearing you say that, in your opinion, the framework presented to us, so this bill, is useless. I was struck by some figures that seem alarming to me. The first is from the program Marketplace, where it was said that about 20% of every match shown on television is devoted to advertising; that seems absolutely enormous to me. I have to tell you that I’m more concerned about the issue of minors and your answer that parents can fix everything. That’s what you hear all over the Internet. Unfortunately, parents are not always capable of sorting everything out, and the figures are absolutely alarming. We’re talking about 15% of minors betting online.
The effect of advertising is obviously huge. It seems to me that this is a major public health problem. How do you respond — even though I understand that you are making efforts, and I have acknowledged them — when people say that you are putting children at risk?
[English]
Mr. Burns: The industry obviously takes very seriously its commitment to putting its product in the most responsible light in terms of not targeting minors. Minors will probably see commercials on television, but when you look at some of the research and work done by the CBC, for example, you will see they counted logos. They recorded the broadcast, froze it and counted logos on the screen. That actual part of the research will show that 6% of what was on the screen were actually traditional television commercials and in-broadcast activation.
One of those broadcasts was in the United States. Logos on fields and courts and rink boards are not advertisements. They are not inducements. They are not [Technical difficulties] brand. In particular, in the way Ontario moved with their regulations, incitement-type language is not permitted. Calls to action are not permitted. No bonus incentives are allowed in mass-market advertising. It is brand. This is what companies are using. But what we see and what we understand and are learning from research — and this is one of the things that Dr. Philander talked about — is that there is a lack of research in this marketplace. People are trying to bring experiences from other jurisdictions that really don’t apply to the Canadian way.
Senator Miville-Dechêne: What about the children?
Mr. Burns: The children — we want to ensure that minors can’t get access. We have regulated environments. There has not been a minor accessing a regulated site in Ontario since that marketplace was created because of requiring identification.
What we have is a gap. I talked about what happened since the 1990s. More provinces need to step in and do what they should be doing, and that is fully regulating the online gaming marketplaces in their jurisdictions because that brings the level of protection that we’ve brought. But this discussion was prompted because Ontario actually took steps and created a fully regulated marketplace. One of the privileges operators get from that is the ability to advertise, and there were a lot of them.
Senator Miville-Dechêne: I just want to know about the age verification mechanism to ensure that no minors have access.
Mr. Burns: The rules are actually created under the legislation on the proceeds of money laundering in Canada. The definition of “gaming account” was built in the 1990s. It was actually built for casino buildings where you would apply for credit. Your driver’s licence or passport is required. You take a picture of it on a mobile site. Some of those mobile sites may turn around and ask you to take a selfie so they can verify that the person on the ID is the person there. Then there is a series of questions. Whether it is TransUnion, Equifax or others, you are verifying location identity. You have to be in the province, and you have to be who you say you are, and there has to be some proof of that.
That mechanism translates into future deposits and other things that must match that name. That verification system is very robust, probably some of the most aggressive sign up rules in the world for online gaming.
Senator Miville-Dechêne: I have one last question. I was surprised that you are called the Canadian Gaming Association, but you spoke only about Ontario. We have 10 provinces. Are there some issues out there, or is Ontario the only one —
Mr. Burns: Ontario is the only one that has chosen to fully regulate their online environment. That’s what has created a lot of this activity. I go back to —
Senator Miville-Dechêne: In Quebec, for example, do you not have online gaming?
Mr. Burns: I have five member companies from the province of Quebec and organizations that work in the gaming space in Quebec. We work with provinces and regulators, too, on education and advocacy around the gaming. One of the things that we’ve asked for, promote and are built upon, is that we want regulated gaming markets. We believe in the value of that regulation and that oversight.
Senator Miville-Dechêne: Sorry, are you saying Quebec has no regulation for those —
Mr. Burns: They do. For a lot of Quebec, they regulate themselves. They don’t regulate anything else.
Senator Miville-Dechêne: Excuse me, could you repeat that?
Mr. Burns: They regulate themselves. Loto-Québec is the operator of all gaming products in the province of Quebec. Every province has a bit of a different model. They’ve chosen to leave the unregulated online space out there, to which Canadians have had access for 25 years. So those sites do not require age verification. You can put in your email address, make a deposit and start playing.
Senator Miville-Dechêne: So you are saying Ontario is the best example?
Mr. Burns: Yes. For online gaming, 100% because —
Senator Miville-Dechêne: So maybe we need a law?
Mr. Burns: No, you have laws. They have all the tools.
Senator Miville-Dechêne: Maybe we need this framework if Quebec and other provinces are not regulating properly?
Mr. Burns: I think of the tools and mechanisms that the provinces already have, and I would encourage you. They came here through the Canadian Lottery Coalition to talk about and complain about advertising. We’ve been asking as an industry association, for decades, to fully regulate because gaming in Canada was built out of a provincial monopoly model. Every province could control what went on in their province, and guess what? The internet was the greatest disrupter for our industry and dozens and dozens of others, and you need to respond. They need to step up.
Senator Miville-Dechêne: Thank you.
Senator Quinn: Thank you, folks, for being here today. My first question is for Mr. Burns.
When you started your presentation, you said that there is no need for Bill S-269, that most things are in place, or something like that. My question is what is not in place? What’s the gap in Bill S-269? If not everything is in place, what’s missing?
Mr. Burns: I think some of the folks spoke about this. There is probably value in coordinated research across the country.
Senator Quinn: That’s what’s missing from the bill?
Mr. Burns: Well, no. That’s one of the things that is in there that talks about it, but that’s something where there is value in doing that. The informal relationships that have been built in some of the organizations that appeared in front of you were part of that, like the Responsible Gaming Council, the Gaming Research Exchange of Ontario. Dr. Philander has talked about it as well. This infrastructure has been built over the last 40 years, and there’s a combination. At the Canadian Centre on Substance Abuse and Addiction, a project was done with the low-risk gambling guidelines years ago. It brought provinces together under the Canadian Centre on Substance Abuse and Addiction to develop those. That’s a great coordinating body. There is value in this because, as Dr. Philander said, there is a gap in some of the research, especially around advertising. The industry would love to see more. We have learned that evidence-based research gives us the tools to better protect players, and we will use it.
Senator Quinn: So the bill will achieve that?
Mr. Burns: Or it can be achieved without the legislation.
Senator Quinn: I would like to get your opinion on my next question, but I would like to hear from Dr. Philander as well. We often hear that those who gamble are the very people who can least afford to gamble, and yet they are there, and it’s an addiction. What’s your thought on that?
Dr. Philander, you said there was no causal relationship between advertising and gambling. I’m trying to piece this together. Where I come from, I know that the people who gamble a lot in the little bars and stuff, but they can’t afford to gamble. They are gambling away their way of life, their ability to pay bills and rent and whatever, and the kids are not being fed. What’s your opinion on that?
And, Dr. Philander, could you talk about the non-causal relationship in the example I’ve given?
Mr. Burns: I will be brief. I believe we should invest in educating people about what gambling is, what it is not, and what it should be used for; it’s entertainment. That’s important for us, as an industry, to understand that there are harms related to our product; we know that. It is often communicated in ways of giving people tools, if they choose to do it, and in giving them mechanisms to support them when they choose to and want to stop. That’s an important part of what we continue to do. Technology is giving us great ability now, especially in the online space, to provide even more levels of protection for players.
Senator Quinn: In order to carry that through to a logical conclusion, you are promoting avoidance and whatnot. Why wouldn’t the gaming association simply advocate for the ban of advertising in the marketplaces that are dominated by people who can’t afford to gamble?
Mr. Burns: Sorry, banning advertising in marketplaces?
Senator Quinn: Where people cannot afford to gamble, why not ban it altogether?
Mr. Burns: Gambling has been part of society for decades and hundreds of years. People are choosing to do these activities.
Senator Quinn: We didn’t have the internet and we didn’t have all this readily accessible.
Mr. Burns: Now we have learned more, have better tools and other ways to do that. One of the measures in Ontario’s regime, players are monitored for risk in the regime. It’s not about if they gamble a lot of money. It’s if their patterns of play change.
Senator Quinn: Maybe I can hear from Mr. Philander.
Mr. Philander: That’s a great question to ask. As a point of clarification, where I was talking about causality, non-causality, that was related to the empirical research, not necessarily the nature of exposure to gambling and playing once again, so we just don’t know the ins and outs of how advertising relates to someone developing a problem over time.
The framework that I find is most helpful for thinking about how a gambling problem develops over time is a model called the Pathways Model. I don’t know if anybody else mentioned it during these sessions, but the simple idea of that model is that there is some sort of exposure to gambling. People may develop what we call cognitive distortions or irrational ideas about their ability to win or not.
Now, a lot of people might develop those. Not everybody necessarily moves on to playing more than they should. At that point, that’s the whole reason why a lot of responsible gambling programs and public awareness programs are created around informing people of the way that, for example, how slot machines actually work — they are random and you can’t control them — or the way that sports betting exists, you actually can’t determine the winner of a game enough to beat the house advantage. That’s why those education programs are set up the way that they are, to keep people from developing those ideas.
If someone has started playing more and more, that’s where we start to see different types of interventions designed for people like deposit limits or loss limits that might exist in a lot of these gambling sites. That’s the idea that somebody might like to play gambling and they might be under control; but to keep them from ever getting to the point where it’s financially damaging, you would want to place some sort of controls on them.
Then toward the end, when people actually have more severe problems, there are other types of interventions that are created, conventionally therapy, but also things that are more operator-controlled responsible gambling problems, like self-exclusion, where people can prevent themselves from logging on to any gambling site whatsoever as long as it’s within the regulatory purview, so the causality question, but then there is also that relationship of how someone develops over time.
Senator Quinn: My last question, if I may, for Mr. Philander: We heard from Mr. Burns that when you go into a rink, for example, there are the boards and logos and things of that nature. He says that’s branding, it’s not advertising. Do you agree with that?
Mr. Philander: I mean, it’s not a call to action, so there are different ways of thinking about marketing generally. One way is the big marketing funnel. At the highest level it’s awareness, and then as you get further down the funnel, there might be a more specific call to action or a specific promotion. There are different ways to think about it.
I don’t know that’s a straightforward way to answer that question. But, certainly — the idea to which he is referring, logos and the marketing [Technical difficulties] —
Senator Quinn: I’m going to jump in with one more clarification. If that type of thing, Mr. Burns, is not advertising, then why is it we go into our rinks today and we don’t see cigarette companies with their logo on the boards? We don’t see them on the jumbo screens and what not. I believe it’s not permitted. I believe that was done because the very thing that people see — Export A, for example, is promoting a brand of cigarettes, which indirectly is advertising. Wouldn’t you agree with that?
Mr. Burns: The relation of smoking to gambling I don’t accept because no one has ever said there is a safe level of smoking. You can smoke three cigarettes a day, and you have no harm. People have gambling habits. It’s entertainment.
Senator Quinn: I found it very bizarre that you said branding is not marketing. I’m trying to understand the correlation between the logo and branding and marketing.
Mr. Burns: In the research, everything is equal. A 30-second television commercial in that research was accounted for the same way as a logo on the floor of a basketball court. Anybody in the media would understand that digesting advertising and what people see while they are watching a game, and what they are really watching, and how that impact is different, I would defer to someone who probably understands media and how advertising is because the impact of a 30-second ad that takes over a commercial versus players running by a logo, because you’re watching the game. They are there, yes, but they are very different.
Senator Quinn: We go to different events. Thank you very much.
Senator Simons: My question is for Ms. MacLeod. You talked about the drop in the numbers of commercials that you are having for review. Is that because there are fewer commercials, or because fewer commercials are being presented to you for evaluation?
Ms. MacLeod: There is a difference between when the commercials run and how many commercials we get. Every commercial that shows up in a television broadcast is taken through our office. The actual number of new creatives that are coming in has dropped considerably over the last little while.
Senator Simons: Are people rerunning the old ones?
Ms. MacLeod: Not necessarily, no, because we have a time limit on most commercials that they can only run for so long. Then they have to refresh the creative. Our approval numbers only last for so long.
This market that I think we have to think about, had gambling and had gambling advertising. I know the Lottery Corporation spoke about it which is under the brand of .net. There was plenty of .net advertising that went on for quite some time. It’s actually dropped off completely now because the regulated market is in place.
As a result, we see the launch of the regulated market. We see a lot of advertising boosting and telling people, don’t go to .net sites. Go to regulated sites because people were going offshore to do their gambling instead of doing it within a regulated environment.
It was a huge launch, big product everywhere, advertising everywhere. Then it continues to drop off as the people are aware of the brands. An important point, just with respect to what Mr. Burns was saying, in terms of brand advertising versus a call to action, call to action is not permitted anywhere. The brand advertising, this is an important point. When you get television coming in from distant signals, there will continue to be brand advertising on rink boards and on the floor of the ice from U.S. feeds. We’re not going to get rid of that type of advertising completely. You cannot ban it because it will come into our market, much like pharmaceutical advertising.
Senator Simons: If you’re watching the NBA, it’s on the floor.
Ms. MacLeod: That’s exactly right. What Mr. Burns was getting at, the CBC in that research was counting the number of logos that were there, some of which were not put there by Canadian broadcasters. They come in from other sources. I think it’s all advertising, but I would not equate the power of a 30‑second spot with a logo on a rink board.
Senator Simons: I’m reminded of when cannabis was legalized. I live in an urban neighbourhood. I swear it felt like every third store was a cannabis shop, and that market settled out. Obviously now I have bakeries back instead of cannabis shops. That’s my addiction.
Ms. MacLeod: I could join that support group.
Senator Simons: I’m trying to understand, in the online market, to what extent are your services mandatory versus consultative?
Ms. MacLeod: This is what I worry about in terms of the broadcast code. The broadcast code and television undertakings and their online parts, as long as they are social media, anything owned by broadcasters, it’s mandated.
Senator Simons: If it’s Rogers —
Ms. MacLeod: If it’s Rogers, Bell Media, any broadcaster with any type of platform whatsoever, we look at those advertising. To the credit of many operators that we work with, to help them get their advertising in place, they were the ones that asked us in the first place to extend our services to online services like Netflix, Prime Video and others, which we are in the process of doing. It was gambling advertisers who came to us and said, “We really don’t want to be offside anywhere. Can you extend these services to other people?” So we went to the broadcasters to say, “Is this okay?” We’re now preparing our system to take on the additional video that we think is coming our way, with the addition of the online streamers. We’re pleased to do that.
Senator Simons: That’s voluntary?
Ms. MacLeod: That is voluntary, but once they come into the system and put their ads through us, we apply the broadcast-level standards to these ads. They know that, going in. This is not a situation where there is a certain standard for online and a certain standard for social media with these third-party players that are different than what we’re doing in broadcasting. This is very positive.
Senator Simons: If you reject their ad, can they still run it?
Ms. MacLeod: In social media and online, yes they could. But the fact that they are coming to us and advertisers are looking for us to do this is an important point.
Senator Simons: You mentioned cultural symbols. Could you elaborate on that? Different cultures have different views on gambling.
Ms. MacLeod: That is correct. We look at approximately 37,000 pieces of advertising per year, and some of the gambling advertising comes from other jurisdictions. We have the broadcast codes, and we’re very conscious of what we’re putting in front of people.
Sometimes the gold coins, for instance, will have Chinese symbols of prosperity. This is a very popular way to do things. We have said that you can’t put those symbols on our advertising. You can’t have anything that would indicate that there is luck, prosperity, good fortune or any of those things.
We go through these ads frame by frame. In terms of minors, if you see a game in an ad, and you see all the tiles that show the different games available, we go through every single one of those tiles to make sure that any image won’t appeal to a minor. If there is a unicorn, it’s gone. It has to be replaced with something that looks adult-oriented. Those are the kinds of details.
Senator Simons: Cartoons?
Ms. MacLeod: None of that. If it looks too colourful or has too many balloons, those games have to be replaced. We’re very conscious of that. We work hard to make sure that within this regulated space, we’re doing our best to make sure that we’re protecting our audiences.
Senator Simons: Thank you.
Senator M. Deacon: Thank you very much to all three of you for being here. I’ll squeeze in a question to each one of you.
Mr. Burns, I would like to start with a conversation about the amount of advertising that we are seeing. We have heard many interpretations today. But we, as you know, listen to a variety of people. We have heard from registered operators that they are having to compete with grey market companies who flout rules and advertising standards, so we shouldn’t really come down too hard on the legal ones.
The grey market is one of the reasons why I initially voted for Bill S-218 a few years ago. When you look at the research such as that of the CBC and Dr. Rossi from Bristol in the U.K., it would seem that viewers of sports broadcasting cable television spend 20% of their time looking at gambling ad during a game, which is three times per minute. It’s legal betting. It’s companies who are paying for this promotion on commercials along the boards on jerseys or helmets, or behind the nets. We could go on with the different media.
Why shouldn’t they, if it’s allowed? But for someone suffering from a gambling addiction sitting down to watch a basketball game now offers the same level of temptation as an alcoholic would feel sitting down at a bar stool. The same goes for youth, particularly young males.
I’m asking you today, Do you agree that three times a minute is a bit too much?
Mr. Burns: As I said, we count the impact of logos appearing in jurisdictions, which is why sports leagues have taken great pains to put policies in place on what is appearing in their venues and what is appearing on their products. There are policies from every league because they were worried about this too. They want to decide how sports betting would interact with their product.
When we look at limits on the leagues that broadcasters and their partners have voluntarily put in place, the NHL spoke to me about a 15% limit. I don’t think they have ever hit it when it comes to most of the advertising, because the advertising has dropped off quite substantially in the last year and a half.
They all taken great pains to understand how gaming products interact with their business, their leagues, their players and their fans. They are constantly gauging and receiving feedback from their fans, because they want their products to appeal to everybody and still be family-oriented. That’s why you have seen in many cases that they limit the number of rink boards or the number of commercials that are available in a broadcast, or the level of activation or logo placement. All of those things have been put in place.
We’re still learning too. We’ll make changes based on understanding of better research. But just counting logos on the screen, which is my objection to Dr. Rossi’s research, fails to understand how people digest media, and what they understand, because a lot of those images are a logo, and if a basketball court is at both ends, they count the logo when it goes up the screen and down the screen. That is how they told me they counted it. The person watching the game is actually watching the sport. Understanding those impacts, and what does that mean? But I do think we don’t know enough. I think we need to do more research. Simply counting certain logos, but I do not know what the impact of those mean. We do know more about the impact of a 30-second television commercial, and we see that the volume of those is a significantly small part of all of that. Dr. Rossi said that less than 6% included 30-second commercials, any activation in a broadcast; that’s what that represents. The rest were logo placements in buildings, some of which were from foreign countries.
Senator M. Deacon: Thank you. I’m going to shift to Ms. MacLeod, looking at ThinkTV’s guidelines for broadcasters. Upon digging and trying to find the most recent document, it stated the following:
The ability of the broadcaster to air commercials of any kind relating to betting or gaming including casinos, bingo parlours and lotteries (“Gambling Advertising”) is contingent upon compliance with a complex set of Federal and Provincial laws including the Criminal Code and Provincial licensing laws.
The word “complex” sometimes doesn’t inspire confidence, which is what I’m trying to fix here in this legislation. How has it been for ThinkTV to navigate this evolving space, which is becoming increasingly muddled, as other provinces follow the iGaming model in Ontario? We have heard a lot about Ontario in here. That’s one part of our country. I’m trying to understand what it looks like for you right now.
Ms. MacLeod: We’re having our guidelines rewritten because the sport’s athletes were banned. These things are evolving, so we don’t want to put anything in there that says you can do this and you can’t do that, because it’s a fluid situation. There is some level of judgment involved when you’re looking at any advertising.
We take a conservative approach. The idea is to explain to advertisers that there are more than just the registered standards. There are broadcast codes; there are Canadian ad standards codes; there are other legal and regulatory requirements like defamation. It’s a complex legal and regulatory environment. I myself am a lawyer, and that’s why I have become so involved in the online gaming space: to make sure we’re applying these standards consistently across every advertisement we see.
In the same way that our province has embraced it, I would be surprised if other provinces didn’t embrace that same code that’s been demonstrated by Ontario to work — and work well, so far — for their province.
At the end of the day, when you have advertising, most advertisers can’t afford to do different versions of advertising. They don’t act like lottery associations. So they adhere to the highest standard, which is ours. To be on the air in any province across the country — because we clear for every province across the country — they will have to adhere to the highest standard. Even if you’re advertising in Ontario, distant signals which happen as a result of the broadcast will pick it up in other provinces. That’s why the highest standard has to apply.
Even if B.C. says, “We only want to do this; we can’t do that,” it’s irrelevant to me because the highest standard is the most important one. That includes the broadcast codes, so we’re not in the same position as social or anything else.
Senator Cuzner: I was going to ask about the mandatory versus consultative, but I think you have addressed that quite well.
The greatest sense of motivation for this bill was how we were inundated. Most of the witnesses that have come before us have talked about the number and the repetition and the fact that big‑name athletes were making those representations. I know, myself, watching a hockey game or a ballgame, you feel like a goose on your way to the foie gras festival getting this stuff stuffed down your throat during a game.
You said that anecdotally, television commercials drive the clients to the online sites. You said that there has been a drop‑off. Do we have something over the span of the last 10 years how it increased exponentially and then has decreased? Do we have a dollar figure for this?
Ms. MacLeod: In terms of television?
Senator Cuzner: Yes, television.
Ms. MacLeod: We can certainly get that information for you, but television is a $3 billion business, and the online gaming space represents a very small part of that. When I look back over the years, even at the launch date, it didn’t even hit the top 20 advertising as advertisers in terms of ranking.
Senator Cuzner: But it’s on television when kids are watching their heroes.
Ms. MacLeod: The thing about television is that, unfortunately, kids aren’t watching in the same numbers that they used to. I hate to be the person to say this out loud, but they just aren’t.
I remember bringing this information to someone else. We looked at an entire season of hockey games since the launch date. There was one playoff game that indexed to the population of young people under 18, only one game out of all those games. Every other game was well below the index of actual Canadians under the age of 18 or 19.
Television is not what we should be thinking about when we’re thinking about youth, to be honest. You can’t fight the evidence; kids are just not watching television the way they used to. But I’m happy to provide those numbers.
Senator Dasko: Thank you to our witnesses for being here today. My first questions are for Ms. MacLeod.
Does your organization have a complaint mechanism process and an investigation process?
Ms. MacLeod: All of the advertising goes through Ad Standards. Ad Standards cover all media across the gamut, not just television. If anyone has a complaint about a television ad they see, they go to Ad Standards. I deal with that just in the normal course as any other advertisement.
Senator Dasko: Your organization does the analysis and research?
Ms. MacLeod: We don’t do the analysis and research; they do. We review them prior to broadcast. If there is a complaint subsequent to broadcast, it’s completely out of our hands. It goes over to Ad Standards.
Senator Dasko: Thank you. We have had witnesses here who have said to us — this question for other witnesses as well — that the ads that have messages such as “seek help” and helplines and so on are not very effective. What we have been told — going back to the experience with tobacco in particular — is that when you show the harm it causes, that is an effective form of communication, when you’re showing the harm of the practice, what gambling can do to you, to your family or whatever. Those are the kinds of ads that are necessary. As I said, we have heard this from previous witnesses.
What do you think about the role of such advertising? Do we need this advertising? Who should pay for this advertising? Should the broadcasters launch these ads? Should the gambling sites launch them? How should they be paid for?
Ms. MacLeod: I will say a couple of things. When we first started getting advertisements in, they do come from other jurisdictions, and there was disclaimers pointing people to get help in other ways outside of our jurisdiction. We went to the Responsible Gambling Council, and said, “This isn’t going to work. What should we do?” They then brought us the suggestion to bring people to ConnexOntario. We have pushed people to go to ConnexOntario in every single ad that is out there. And now subsequent to our suggestion that this happen, we mandated it for television broadcast. The AGCO has told the gaming operators to put them on their web sites.
Then I heard that ConnexOntario has been inundated with calls and requests. I can’t imagine it’s not effective if people are calling in. So that’s the first thing.
It may not be my responsibility to tell them all the harm, but it’s certainly my responsibility to direct them in case they are feeling some concerns about what it is that they are doing. ConnexOntario, in my mind, has been a very successful way to do this.
In terms of the types of responsible gaming messages, I’m not in the best position to say. What I can say is ThinkTV, on behalf of the broadcasters, for the last two years donated money out of its own funding, which is not great, to ensure that at the same time the market launched, there was responsible gaming campaigns on the air as well.
We worked with the AGCO to say, “We’ll give you this money. You develop the campaign.” We were told that the campaigns around launch have to follow a certain kind of methodology. You have a certain type of campaign, and then you have a different type of campaign, each covering a different aspect of harm. It may very well be that they are going to do something in the next phase of the advertising that addresses exactly what you’re talking about, showing the actual harm.
In my judgment, that’s not my thing to do. What we have been able to do is ensure that those two campaigns got on the air.
Senator Dasko: That’s not a role for broadcasters is what you’re saying.
Ms. MacLeod: It’s not. We donated the time. It’s not just the time and money that we donated as ThinkTV. It’s the millions of dollars worth of advertising that the broadcasters donated.
What we find with any PSA is that an organization will do it, and then broadcasters donate inventory to ensure those messages get out there, which I think is the appropriate role.
Senator Dasko: Mr. Burns?
Mr. Burns: One of the things we have seen with the launch of the Ontario market is stand-alone responsible gaming messaging, so promotion of player tools. Those are limit settings, loss limits, time-out settings, activity and also the logo for ConnexOntario.
A requirement of iGaming Ontario is for operators to spend a percentage of their gross revenue on stand-alone responsible gaming advertising. It’s in the contracts that operators have. They have the ability to set it, they give a notice every year of what it has been.
My understanding was in the first year, there was no requirement. It was wanting to see, but an encouragement to do it. Then it was added that now half a percent of their gross gaming revenue must be dedicated to stand-alone responsible gaming advertising as their work. That’s something that iGaming Ontario, as the contractor holder, not the regulator with AGCO but the contract conductor, manager, have the ability and contract to enforce and set that number annually.
Stand-alone messaging regarding understanding safer play didn’t exist until a few years ago. Now it’s very important. It was always a tag line.
I agree with previous witnesses. Tag lines were nice, but the fact is stand-alone advertising that talks about messages and tools is much more effective, and that’s what we’re seeing a lot more of now thanks to the regulated work in place.
Senator Dasko: Professor Philander, my question has to do with the role of this type of advertising in potentially dealing with problem gambling, just the same way that these ads in the tobacco area have been really important in helping to dissuade people from taking up tobacco use or quitting.
Mr. Philander: A couple of quick points, because I know you’re running short on time.
We talked about those in terms of being negative-framed ads. Those are great empirical research questions that we don’t necessarily have great answers to, in gambling. Gambling is a different product than tobacco because it’s harder to control at the place of consumption.
If you had, for example, as an unintended consequence, negative-framed ads that happen in the regulated framework, but the unregulated marketplace doesn’t have negative-framed ads associated with their product, then you might see substitution effects. It is a great idea and something to look at from a research perspective, but there are a lot of open questions about how that would work in a gambling marketplace where it says tobacco or other types of products.
Senator Cardozo: I have a couple of quick questions. Ms. MacLeod, you talked about providing approval for advertising which broadcasters are using on platforms like Netflix. Are they using those same ads with those same standards, if I can use that word, on other platforms?
Ms. MacLeod: Maybe I misspoke. All broadcasters on every platform where their content is come through us, and it is the same advertising that you will see to the same standard.
What I’ve said is that new platforms like Netflix, Prime Video and Roku are approaching us, and we are working with them to make sure their advertising will be to broadcasting standards. That’s something we’re taking on.
We just finished discussions with Roku to bring them on as well. It is not just that your broadcast advertising, whatever platform it is on, will adhere to those standards. It’s that any advertisement that Roku, for instance, wants to bring in for any organization for their connected-TV advertising will be cleared to the broadcast standards as well.
Senator Cardozo: So if a broadcaster puts an ad on Instagram, it will have come through you?
Ms. MacLeod: Yes. If it is a five-second, six-second, thirty‑second spot, yes.
Senator Cardozo: The Canadian Association of Broadcasters, for example, last week, said it is too early to regulate. That’s one position. The other position states if you wait, it will be too late.
Given that both of you described Ontario as the only one who is, if I can use the term, taking it seriously, would a bill, such as Bill S-269, not goad the other provinces into getting on board and regulating in their areas, too?
Ms. MacLeod: I think that’s a different question. I don’t think that that is necessarily how we’re going to see change happen. The lottery corporations have a different set of standards than the third-party online gamers. There are competitive considerations in each market, and I’m not sure at this stage that the framework is the right way to go. I think we have to see more of a natural evolution.
I really do believe in research to understand what is necessary and to address any harms we see existing before we start extending it nationally. I think that may be the issue. As you extend something nationally, it becomes impossible to get the research that you need.
Senator Cardozo: Would it be useful if the industry themselves move it along? I am concerned about the point where it is too late to regulate.
Ms. MacLeod: I completely believe that, and ThinkTV has talked to the gaming operators about this and the CGA in particular about this, as well as iGaming Ontario, to say that we would be in support of any research and willing to do whatever we can to contribute to the funding of that. We suggested to iGaming Ontario that not everyone will have enough marketing dollars to do an impact report and RGC.
Wouldn’t it be great if we could put that money into research within the industry to make sure that any kind of national framework or any extra regulations will be effective? I think that was a positive way to do things, but with iGaming Ontario, at the time, it was difficult to move through circles, but it is a topic we have been exploring and will continue to explore.
Senator Cardozo: So you don’t think based on what Ontario is doing, the others are ready enough to move and that we still need to take a long time do more research?
Ms. MacLeod: I wouldn’t say we need a long time to do more research, but I would say research is absolutely necessary. What we see with advertising, especially with children and youth — and I know I said they are not watching as much as I would like them to be. We don’t know as adults. It is easy to sit here as a middle-aged white woman and say I know what children will like. We certainly do not know what children will like.
Separate and apart from gambling, we’ve looked at children’s advertising since 1970. It varies. It is different, and you have to have specific knowledge in that area. Research in that area is absolutely critical. That would be my primary focus, to be honest, moving forward, to figure out whether the framework we have is causing any harm, whether it could be improved and what makes the difference to kids. Because it varies. None of us are really in a position to suggest to young people, especially what appeals to them.
Senator Cardozo: Okay. Thank you.
The Chair: We are already past our time limit by five minutes, but with the indulgence with this very interesting panel, I have two more senators to squeeze in for round two. Senator Quinn and Senator Deacon, I will give you two and a half minutes each. Could you be concise in your questions and answers because we still have a second panel to go to?
Senator Quinn: With the chair’s permission, I defer my time to Senator Deacon.
The Chair: Senator Deacon, you have three and a half minutes.
Senator M. Deacon: Ms. MacLeod, you mentioned that athletes are banned but not entirely. Athletes and celebrities can still appear in ads as if they are focused explicitly on responsible gambling.
One prior witness last week referred to this and took issue with the regulations, saying that they are still branded ads. I want to elaborate on this a little bit. He said:
. . . it’s a very convenient approach to be able to say, we’re going to inundate you with ads and opportunities to gamble. Now just do it responsibly, and you’re going to be okay.
Particularly with young men, research shows they are particularly susceptible to gambling addictions. These ads are with their heroes, celebrities, people they look up to, could even give them a false sense of security that the gambling company has their back, is being responsible and won’t allow them to get carried away. I want to get a sense of that messaging and your thoughts on it, if you don’t mind.
Ms. MacLeod: I have to defer to Mr. Burns because that’s actually a requirement of the gaming operators that they do responsible gaming messages. Each is permitted to do branded messages. I will say as an aside that I imagine these athletes were under contract for quite some time, and the companies were in a position where they were no longer doing the gambling ads, so they turned to the same athlete who was under contract to get the responsible-gambling messages out there. I suspect now that those contracts are over, we will see very few athletes, if any, within those responsible-gambling ads because they are incredibly expensive. That’s my take, but over to Mr. Burns.
Mr. Burns: That’s a fair take on it, too, and Dr. Philander may have comments on the impact of advertising.
Yes, it was something that the Alcohol and Gaming Commission of Ontario would consider to see if that could have a positive influence on player tools that are available. Anecdotally, I can tell you that Ontario has seen a much higher uptake on the use of those tools that they are required to offer, like limit setting and time-outs. We’ve seen a higher takeup rate for use of those tools by players than other jurisdictions experienced. I talked to operators who were surprised to see numbers like that. Around 20% of players were using the tools on a regular basis. That’s exceptionally high. That’s what we’ve seen to date.
As always with these things, we need to look at whether it is impactful and effective. We had conversations with the ACGO and other parts of the industry, like ThinkTV, about looking at research on this space and the effectiveness of it. That’s an important thing to do.
[Translation]
Senator Miville-Dechêne: I want to come back to Quebec because, since their sports betting site is a state monopoly, you have to analyze it to see if there is any advertising that resembles Ontario’s advertising. In your opinion, are they ahead of you in terms of advertising, do they have less of it? Is that advertising more responsible or not?
The other thing is that it’s all very well for you to say that this only concerns Ontario, but Ontario advertisers advertise their sites in Quebec, and that’s completely illegal.
You’d expect a state monopoly that’s a little closer to public health to advertise more responsibly than private companies. Personally, I don’t know. Have you ever made this assessment between what Quebec, which has a state monopoly, is doing and your industry?
[English]
Mr. Burns: Loto-Québec does a very good job at promoting responsible play and the way they worked at that. The challenge is they don’t have a state monopoly anymore. They have not had one for 20 years. The internet has been a great disrupter.
It’s wonderful to say that, on one level, yes, our gaming products are fantastic, but as a government, you have a greater responsibility for the citizens of your provinces, and you need to step up and regulate. That could go from modelling after what Ontario has done or creating a set of laws to ban it, but they’ve done nothing, and that’s not acceptable. That has to change.
Senator Miville-Dechêne: What about the illegal advertising in Quebec?
Mr. Burns: It is not illegal. The fact is the grey market is unregulated. It is not illegal. It is a convenient term that the local lottery corporations have liked to use, but it is not true. It is unregulated.
The Criminal Code doesn’t apply extraterritorially. These sites are sitting offshore.
It is not new. This has been going on for 25 years, and no one has bothered to do anything until Ontario stepped up to do that. That’s why all of this activity has come, because somebody actually stepped up and created some of the highest regulatory oversight in the world. Nine other provinces have sat and done nothing.
In our submission on sports betting, 90% of the sports betting that is occurring in Ontario is going through regulated channels. That’s what we wanted by making the change to Bill C-218. Ontario stepped up. That’s what’s happening. We are starting to see regulated gaming. In the rest of the country, it’s less than 10% of the total.
They have the tools to do this work, and they need to use them.
Senator Miville-Dechêne: Thank you.
The Chair: Mr. Burns, Ms. MacLeod and Professor Philander, we thank you for coming before our committee. You can see by the fact that we went over our allotted time that the committee appreciated your input very much.
[Translation]
Honourable senators, we are meeting now to continue our study of Bill S-269, An Act respecting a national framework on advertising for sports betting.
[English]
For our second panel this morning, the committee welcomes representatives of the Canadian Radio-television and Telecommunications Commission, or CRTC, who are familiar with our committee — and we are with them, of course — Scott Hutton, Vice-President, Consumer, Analytics and Strategy; Nanao Kachi, Director, Social and Consumer Policy; and Rachelle Frenette, General Counsel and Deputy Executive Director.
Welcome, and thank you for joining us. We have five minutes allotted to our panel. I understand Mr. Hutton will be making his opening remarks. I will then turn it over to my colleagues.
Mr. Hutton, you have the floor.
[Translation]
Scott Hutton, Vice President, Consumer, Analytics and Strategy, Canadian Radio-television and Telecommunications Commission: Good morning and thank you for inviting me to appear before your committee. Before I begin my remarks, I would like to thank the Algonquin Anishinaabe nation for having me here as a guest on their unceded, unsurrendered territory. I would also like to thank them for being stewards of the land and waters in this area since time immemorial.
I am joined today by my colleague, Nanao Kachi, Director of Social and Consumer Policy, and Rachelle Frenette, General Counsel and Deputy Executive Director.
As you know, the CRTC is an independent, quasi-judicial tribunal that regulates the Canadian communications sector in the public interest. The CRTC holds public consultations on telecommunications and broadcasting matters and makes decisions based on the public record.
On the broadcasting side, we are implementing the Online Streaming Act, which was given to us by Parliament, and which requires us to modernize Canada’s broadcasting framework. The changes that are needed are substantial and complex. There are many interconnected issues to be addressed.
[English]
Advertising, of course, is part of most broadcasts. We recognize gambling advertising is part of the landscape since the Safe and Regulated Sports Betting Act came into effect in 2021. The bill before the committee today asks the Canadian Radio-television and Telecommunications Commission, CRTC, to review advertising regulations and policy, in particular those related to the promotion of gambling in Canada.
I would like to take a moment to outline how advertising regulation currently works in Canada.
Oversight of advertising is a shared responsibility between federal and provincial governments, private companies, ad agencies and broadcasters.
Over the years, experts have developed a number of advertising codes, such as the ones for alcoholic beverages and advertising to children. Health Canada has also banned advertising for tobacco and cannabis products. The CRTC requires that broadcasters only air advertising that is consistent with these codes through conditions of service.
We also work with our partners at Health Canada and Ad Standards.
For instance, Health Canada assesses the health impact of a product and provides its expertise in the development of advertising codes.
Ad Standards is a national, not-for-profit organization in Canada whose mission for more than 60 years has been to ensure that advertising is truthful, fair and accurate. It administers and reviews these codes and measures their effectiveness.
We know that Ad Standards consult subject-matter experts in all of its work. Ad Standards also work proactively with advertisers as they develop their campaigns, with services such as advertising preclearance to help ensure campaigns adhere to all relevant advertising codes and protect the interests of Canadians. This process has a proven track record of success.
For example, we know Ad Standards receive very few complaints of violations of the codes in regard to alcohol advertising and advertising directed to children. This is, in part, due to its extensive work with the advertising community, and with experts. This work is ongoing with respect to the gambling industry as well.
We know that Ad Standards are currently working with the Canadian Gaming Association, as you heard this morning, to develop and administer a code for responsible gaming and advertising.
Ad Standards plan to provide preclearance services, in the same way it does for alcohol advertising and advertising directed to children, so the gaming industry can ensure compliance with the code’s principles.
When this code is ready, the CRTC will require broadcasters to adhere to the principles within it, as with other advertising codes.
[Translation]
We also know that provincial governments are doing a lot of work in this area. For example, the Alcohol and Gaming Commission of Ontario has worked with Advertising Standards Canada to establish a regulatory framework for Internet gaming sites operating in the province. The framework includes a set of standards aimed at eliminating false and misleading advertising, advertising that targets minors or at-risk individuals, or advertising that encourages excessive gambling.
We believe that our Advertising Standards partners and the experts the organization relies on will develop appropriate codes that we can then include in the conditions of service that broadcasters will be required to meet.
We understand that the Canadian communications sector touches every aspect of our daily lives, and we look forward to continuing our work in the public interest.
Thank you again for the opportunity to appear before you today. We would be pleased to answer any questions you may have.
[English]
The Chair: Thank you, Mr. Hutton.
Before I turn it over to senators for questions, a short question on Bill S-269, for Mr. Hutton. From the CRTC’s point of view, what are the pros and cons of this piece of legislation?
Mr. Hutton: As you know, as an independent tribunal, we will trust legislators. We are takers of legislation. We will abide with whichever mandate we are given. It essentially asked the CRTC to look at its regulations as the issue. We are here to say we will do that, look at those issues, and it is already occurring.
The Chair: With all due respect, as a witness before this panel, and given your experience, I can give you a countless number of examples where the CRTC has shared an opinion on other pieces of legislation. We are certainly not going to hold you to it, as we rarely hold the CRTC to account anyway. It is incumbent upon —
Mr. Hutton: Last time I was here —
The Chair: On Bill C-11, they had an opinion. They pick and choose. That’s what I’m trying to highlight. They pick and choose what —
Mr. Hutton: Senator Housakos, my first answer to all of those questions that are always posed is that one, exactly.
Now, to help you more — as you insist upon that question — it is asking a variety of things.
Essentially, it is asking the Minister of Canadian Heritage, to come up with a strategy for advertising overall. Certainly, they are experts with respect to sports and oversee the broadcast policy of Canada.
It is also asking us to look at our own regulations going forward on that front. There is no harm in virtue with respect to actually looking at studying the situation and coming up with some form of standards.
I was listening to the same witnesses you were listening to this morning. There is a lot of debate. There are many issues to be mindful of. As federal institutions, all of us need to roll up our sleeves and work on this. We will certainly be doing that in that context, and with the help or guidance of some type of national permission.
Senator M. Deacon: I will carry on from our chair’s initial question specific to the bill.
Before we move too far forward, Mr. Hutton and team, I need to get a history lesson to get a better sense of how the Code for Broadcast Advertising of Alcoholic Beverages came about. We have heard a few times that gambling ads are for the provinces to sort out and there is not much the federal government can do.
When we look at the alcohol code, I am at a loss to know why that would have been different, as the research shows us that gambling addictions can cause the same degree of societal and personal harm as alcoholism, such as the loss of jobs, disrupted families, those kinds of things.
If you can, could you briefly relay how the alcohol code came about and why the CRTC would have regulations for one and not the other?
Mr. Hutton: As explained in the opening remarks, we work closely and trust the experts in the field. An example we mentioned was to develop the regulations we do have in place for alcohol, smoking or other areas in which advertising has a grave impact.
Essentially, we looked to the bodies who are the experts — the federal government, naturally first, also other bodies in that element.
The history is essentially those codes and rules start with, for example, Health Canada setting those guidelines, because they have their expertise with respect to the health impacts of alcohol and smoking. They make that decision. We take guidance from that decision and implement that with, naturally, our partners.
If there are areas of interpretation, that’s where the codes come into place.
If there is a ban, it is quite clear. It has come from Health Canada, and the minister’s authority granted to him in the machinery of government.
Senator M. Deacon: Thank you.
More deeply, and this might be touching on an opinion question, but alcohol sales have multiple levels of protection when it comes to selling to minors and addictions. As we discussed, not only are the ads regulated federally and provincially, but physically. Mostly, you have to go — there are some new things now — and buy alcohol. Ideally, the store clerk will not sell it to you if you are inebriated or under age. Gambling doesn’t have those same guardrails or the same protection.
The speed with which you can go from an ad to placing a bet might take a minute or less.
There is no safety valve to determine if a person can afford it or not or is suffering from crippling debt and all those pieces.
Here is the question; you can only give your opinion: Would it not make more sense to elevate the importance of regulation around advertising for betting? Why would the CRTC be concerned about alcohol ads but not gambling ads? Anything beyond your first answer about the goal of Health Canada would be greatly appreciated.
Mr. Hutton: Well, the CRTC is concerned about all social ills or advertising or broadcasting that has an impact on Canadians and their health and well-being.
We regulate the whole industry, so we have those rules that have been essentially set with respect to alcohol by Health Canada. What is occurring right now is, essentially, that there are no such rules in this place right now. We are going ahead and we’re collaborating with Ad Standards and broadcasters to make sure that the codes are updated and to make sure that they reflect the principles that we have had in place for decades with respect to other forms of advertising; also, the specificity developed with respect to gambling.
But if you go back to who is the prime expert, it is the experts at Health Canada. They should clearly be involved in establishing, as for example, that this bill calls for a national standard with respect to advertising.
Senator M. Deacon: Thank you.
Senator Simons: Thank you, Mr. Hutton. Nice to see you back before us. I always love when the beard comes in. It makes me feel like it’s 1867.
Section 6(2) of the bill provides that the commission must provide a report containing its conclusions or recommendations not later than the first anniversary of the day on which this act receives Royal Assent.
I wanted to speak to you about all these extraordinary demands that have been put on the CRTC of late. Is that a reasonable deadline? Do you have the resources and the time to produce a comprehensive report of that nature within a year?
Mr. Hutton: The CRTC does have a number of things on its plate, Bills C-11, C-18, a number of matters with respect to Telecommunications Act, policy direction on that front. You are correct.
Certainly, it will take resources to do this. Resources would be stretched. It’s our responsibility to go seek those resources at that point in time.
It is an issue currently being worked on that we are already trying to get a handle on. I would not argue with a year period to produce that report, and it will be our responsibility to find the resources to get that done.
Senator Simons: You have mentioned Bill C-11 and Bill C-18. I know this is not the time to discuss them. But I’m wondering if the committee asked you back sometime this autumn to provide us with an update on where Bill C-18 and Bill C-11 are in terms of your brief, would you be willing to come back to do that? We spent a tremendous amount of time on those bills, all of us together.
Mr. Hutton: The CRTC will certainly be available to come and discuss. It’s just that we’re at a very heightened period. We might have more news to give you if it is late autumn rather than early autumn.
Senator Simons: Thank you.
Mr. Hutton: Sorry for that plan.
Senator Simons: That’s very good. That made me very happy.
Senator Cardozo: I have a question about the overall set of policies you deal with. Did I hear you right that the commission is in the process of reviewing various policies of this kind? If there were not this bill, would you be looking at this type of oversight?
Mr. Hutton: The oversight has begun. This bill has been around for a while —
[Translation]
I can’t speculate on the cause or effect on that side.
[English]
Certainly since 2021, sports betting is a reality in Canada. I, like the rest of you, have seen a lot of ads. The CRTC has seen a lot of ads on television and on other platforms.
Our regime is, essentially, is that we have the codes that we enforce with broadcasters. We have a partnership with Ad Standards Canada which reviews to make sure that they meet those codes. The work to update those codes, as you heard this morning, is underway. Certainly, that part of the job is being worked on and is being developed. Health Canada is working, as we understand, with Ad Standards Canada. Work is occurring on that front.
Senator Cardozo: Does this bill help that work move along?
Mr. Hutton: Well, work is occurring. The CRTC is a national regulator. We will take those codes. There will be debates when we are putting them in place that will be done pursuant to the public hearings and public proceedings. It will be conditions imposed upon broadcasters. We’ll see how that develops on that front.
The bill here asks for certainly a national strategy. We will do our role with respect to broadcasting and advertising on the national front with the help of the experts who are working on it right now.
But the bill does go a little bit wider, which is outside of our perspective on that front. Certainly as we’re seeing it right now, one province is very active, and they are sending, looking to help and establish standards. You have 9 provinces and 3 territories out there that the work is not occurring on. Should there be a national look at that? Should there be an overall concern under — certainly if I were Health Canada, I would be interested in the life of all Canadians, not just certain provinces.
That being said, gambling is a provincial jurisdiction, so we have to manage within that framework and the constitution as the CRTC. We will do our work broadcasting, advertising with respect to broadcasters.
Senator Cardozo: Can you say more about the relationships on two fronts, one is on the federal-provincial issue? You have outlined your thoughts about this particular issue. But in the past, I’m sure that when you dealt with alcohol advertising, for example, it was different across the provinces. What is the experience of how you got everybody on the same song sheet?
My other question is: If you could just explain to us the relationship between advertising Canada, and ThinkTV?
Mr. Hutton: With respect to the first question, it is Health Canada who set the rules. That’s how everyone got on board. A greater role in this case might be something that needs to be highlighted as the bill moves forward with respect to that front.
As you saw this morning, Ad Standards is one body, its own corporation. It’s a member corporation of which advertisers, broadcasters and other key people involved in the industry are members of it. They have a role. They set standards. They approve and provide services such as preapproval. That’s an entity that is independent, in itself has its own board. We follow them quite closely. We work with them quite closely. That is one entity.
ThinkTV is part of the Canadian Association of Broadcasters. It’s under their umbrella so it is the broadcasters, and ThinkTV is essentially — if I can over simplify, hopefully I don’t over simplify on that front — but it is the side of the business that addresses specifically the television-related operations on that front of broadcasters, so it is an association on that front. They will represent with respect to advertising issues. They will promote, do studies, do empirical research, work behind the scenes to provide and bring and put value in advertising on television.
Senator Cardozo: Is Ad Standards sanctioned by CRTC in the way that Canadian Broadcast Standards Council is?
Mr. Hutton: I don’t think we have an official regulation that sanctions them. They are part of the system. They have been there for decades and we have been working well together, so I don’t think we have a specific regulation or hook with respect to them. But they get looped in through the imposition of the broadcast codes or the various codes and standards with respect to broadcasting.
Senator Cardozo: Thank you.
[Translation]
Senator Miville-Dechêne: I would like a clarification. Mr. Hutton, you mentioned Health Canada several times. Has Health Canada started thinking, writing, talking to you about these issues, or are they waiting?
Mr. Hutton: I don’t think we’ve had that discussion with Health Canada. I believe that the department is consulted by the associations, as you understood this morning, and that it is working with Advertising Standards, but it is not involved with us on this issue at the moment.
Senator Miville-Dechêne: I know that your mandate has been expanded to include the Internet. Would it be conceivable for the CRTC to have standards, both for broadcasting and for the Internet, standards for advertising that comes from all over the place? That seems rather difficult if the advertising comes from elsewhere.
Mr. Hutton: Internet, that’s a big word. The standards, in accordance with the new version of the Broadcasting Act, come under Internet broadcasting. Naturally, existing players, as you have heard this morning, must comply with the good practices put in place, and they will have to do so in the future following the hearings we held on the new evolution of the standards to address the topic we are considering today.
Senator Miville-Dechêne: Are you talking about Canadian companies?
Mr. Hutton: They are already there. The situation will evolve. I’ll use slightly simpler words: Online streaming services will also have to comply with the standards, and they are under our jurisdiction. So if Netflix advertises and if other players who actually do broadcasting advertise, it will be in accordance with the standards and under our jurisdiction.
If we’re talking about ads shown on Google, when you do a search, for example, those ads would not be subject to the standards, just like ads on social networking platforms. These are all things that we don’t regulate and won’t regulate, as we lack the jurisdiction to do so.
Senator Miville-Dechêne: Thank you.
The Chair: Just a point of information, senator. Health Canada was invited to our committee. The department refused. Apparently, the reason is that Bill S-269 is not their bill.
[English]
Basically, to clarify, they said this belongs to Heritage Canada, but it doesn’t. My response is the same as yours, but nothing ceases to amaze me.
Senator M. Deacon: I wanted to ask you quickly if there is anything about this bill that hinders the work that you’re doing, if it gets in the way or could be a challenge or could be something that goes against the grain of some of the work you are doing, anything in that area?
Mr. Hutton: Not our work, no.
Senator M. Deacon: Okay, thank you very much.
The Chair: Thank you.
Colleagues, if there are no more questions for our friends at the CRTC, we will adjourn this meeting. Thank you for coming.
(The committee adjourned.)