Quebec online gambling law would have ‘huge’ costs for ISPs: CWTA

New Quebec legislation forcing Internet service providers (ISPs) to block certain online gambling websites from being accessed in the province could put smaller ISPs out of business, industry reps said. Last week, Quebec’s national assembly adopted Bill 74, which put into force several measures introduced in the province’s 2015 budget. Among these were changes to the Consumer Protection Act, making it illegal for ISPs to “give access to an online gambling site whose operation is not authorized under Quebec law.” The legislation provides for a list of these sites to be compiled by the province’s gaming agency, Loto-Quebec. These so-called illegal sites don’t “apply the same responsible gaming rules” as Quebec’s legal gaming site Espacejeux, the bill said. “In addition, the measures announced will enable the government to recover revenues that are escaping it and to fund public services for the benefit of all Quebecers,” it said. But blocking websites in one province is an onerous and expensive task for ISPs, unlike the national censorship of child pornography material that’s already in place, Tiéoulé Traoré, the Canadian Wireless Telecommunications Association’s (CWTA) government relations manager, said. “When you look at child pornography websites, when the networks are national, it’s not difficult to block the content everywhere. But when looking at gambling sites, if you’re asking us to only do it in Quebec, we don’t have right now the technology to do so and to access that technology, it would require a huge amount of money,” Traoré said in a phone interview. CWTA represents some of the country's largest telecommunications providers, but Traoré said that the burden would be felt by companies both large and small. “If you ask (small ISPs) all of a sudden to get the equipment, technology necessary to block websites it would likely cause them to end their business venture and stop delivering services because they would not be able to absorb the cost,” he said. Bram Abramson, TekSavvy Solutions Inc.’s chief regulatory officer, agreed in a phone interview with Traoré’s prediction, saying that they would have to fundamentally change the way their network operates to segment Quebec as its own entity. “Yes, it could put small providers out of business,” assuming the law proceeds as written and properly comes into force, Abramson said, noting much would ride on what technical means Quebec chooses to allow ISPs to use. “This will likely require investment in new equipment, it could require investment in new techniques of handling traffic that raise the cost of acting as an Internet provider,” Abramson said. “And it’s one of a number of measures — likes notice-and-notice at the federal level — that load additional responsibilities onto Internet access providers as intermediaries.” The new rules would also put a chill on competition, he added. “It’s a complex situation, but certainly if the goal is to engender a competitive marketplace for digital connectivity, this is a break on that kind of competitiveness and it really will be a particular burden on smaller companies and a particular burden on those who might otherwise enter the market,” Abramson said. But before issues of cost come into play, the matter of jurisdiction has to be settled first. The Quebec government categorized the new law as not only affecting gambling, but, as finance minister Carlos Leitao said prior to the May 17 vote, “it’s a question of public health and consumer protection,” according to a French transcript of national assembly proceedings. Health is a provincial mandate, but telecommunications falls under federal jurisdiction and the CWTA thinks the new law is “a violation” of the Telecommunications Act, Traoré said. Section 36 of the act says that “except where the approves otherwise, a Canadian carrier shall not control the content or influence the meaning or purpose of telecommunications carried by it for the public.” Traoré said the CWTA raised this with Quebec legislators and pointed to an amendment made to the bill that delays the coming into force of the website blocking provisions until a still-undetermined “date or dates to be set by the Government.” “So there’s no definite date of enforcement of the website gambling portion which allows us in the meantime to continue to discuss with the government and hopefully find a way to solve this matter because our concerns remain,” Traoré said. But if the province does decide to move forward, legal action is basically a foregone conclusion, according to Michael Geist, who holds the Canada research chair in Internet and e-commerce law at the University of Ottawa. “I think we’re heading for a court battle,” Geist said in a phone interview. “It seems to me that given the implications for net neutrality, given the broader telecom regulation issues, the major ISPs operating in the province will really have no choice but to challenge. And in some ways, the more interesting question… is whether or not the federal government will join in on those challenges.” Last month, Heritage Minister Mélanie Joly responded to a question in the House of Commons about the yet-to-be adopted Quebec legislation, saying that “we believe in net neutrality.” “The government of Canada supports an open Internet where Canadians have the power to freely innovate, communicate and access the content of their choice in accordance to Canadian laws,” said an email statement from Innovation Canada spokesman Hans Parmar. “We are aware of the legislation in question and we are monitoring its implementation closely.” If the law were enforced, to avoid having to serve two masters, the industry’s move would be to take it to court and ask for a stay on the legislation, Geist said. Quebec-based provider Cogeco Inc. “had already expressed its opposition to the clause in Bill 74 requiring ISPs to block certain Internet content,” Cogeco Connexion spokeswoman Marie-Claude Dubeault said in an email. “Obviously, we are disappointed that the legislation has been adopted. We will study the provisions of the law and all of its impacts.” BCE Inc. referred media requests for comment to the CWTA, while Quebecor Inc.’s Videotron did not provide a comment. Abramson said TekSavvy would also be watching the next moves of various levels of government and closely considering their own options, depending on what the provincial and federal bodies’ next steps are. “Quebec has been an outstanding supporter of communications and network innovation and programs in the past which have supported network build out as well as further investment in different sectors of the digital economy,” Abramson said. “And it’s disappointing to see a step backwards taken here by looking first to neutral intermediaries who, if one agrees that net neutrality is a good policy, ought to be the last resort, not the first ones up to bat.” — With reporting by Charelle Evelyn at cevelyn@thewirereport.ca and editing by Anja Karadeglija at akarad@thewirereport.ca

Quebec online gambling law would have ‘huge’ costs for ISPs: CWTA

News | May 26, 2016

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Quebec online gambling law would have ‘huge’ costs for ISPs: CWTA

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