Canada’s publicly owned lottery organizations are urging provincial governments to tighten oversight of sports prediction markets. The move follows a ruling that these contracts should not be regulated as securities or derivatives.

The Canadian Lottery Coalition has registered lobbying activity focused on prediction-market products. The coalition says some of these products can resemble gambling while operating outside established gaming frameworks.

The coalition represents public lottery and gaming organizations in seven provinces, according to CDC Gaming.

A regulatory gap is now the central issue

On August 27, 2026, the Canadian Securities Administrators and the Canadian Investment Regulatory Organization issued joint guidance on event contracts. The guidance covers products whose payouts depend on future events, including sports and entertainment outcomes.

The regulators said sports and entertainment event contracts should not be regulated under Canadian securities and derivatives legislation. The Canadian Investment Regulatory Organization also said it would not consider applications from dealer members seeking to facilitate or approve trading in those contracts.

The decision does not create a national gambling licence for prediction-market operators. Provinces and territories must determine whether specific products fall under their gaming laws or other regulatory frameworks.

Why lottery corporations are intervening

Provincial lottery corporations argue that prediction contracts could compete directly with regulated sports betting. These products may be offered through investment-related channels, while traditional sports betting is subject to provincial rules.

  • Licensing requirements
  • Age verification
  • Geolocation controls
  • Responsible-gambling measures
  • Payment and advertising rules

The coalition’s lobbying effort shifts the dispute from securities regulators to provincial policymakers. Its position is that products based on sporting outcomes should face safeguards comparable to those imposed on regulated gambling products.

  • Securities regulators assess whether a product falls under capital-markets law.
  • The Canadian Investment Regulatory Organization supervises investment dealers and certain trading activity.
  • Provincial gaming authorities oversee gambling products under their own laws.
  • Lottery corporations operate or manage public gaming systems, depending on the province.

What could change next

Provincial governments could decide whether prediction contracts should be treated as gambling, restricted under existing gaming rules, or addressed through new legislation.

The rules may differ across Canada because there is no single national online gambling regulator or uniform licensing system.

The dispute also has financial implications. If prediction-market products attract spending that would otherwise go to provincially regulated sportsbooks and lottery systems, governments could face pressure over public revenue, consumer protection and tax treatment. The size of any such impact has not been established.

The August 27 guidance leaves other types of event contracts under review. The Canadian Securities Administrators and the Canadian Investment Regulatory Organization said further guidance may follow.

For now, provincial governments remain central to determining whether sports prediction products are treated as financial contracts, gambling products, or prohibited offerings within their jurisdictions.