Horse Racing Bets in Canada: Section 204, Pari-Mutuel Pools and the CPMA

The phrase that keeps racing separate

Provinces run casinos and sportsbooks under paragraph 207(1)(a) of the Criminal Code, which lets a province conduct and manage a "lottery scheme". Subsection 207(4) then says what a lottery scheme does not include. Since the Safe and Regulated Sports Betting Act (S.C. 2021, c. 20), paragraph 207(4)(b) reads: "bookmaking, pool selling or the making or recording of bets, including bets made through the agency of a pool or pari-mutuel system, on any horse-race".

That amendment is what opened single-event betting on other sports to the provinces. Horse races stayed on the excluded list. Subsection 207(5) adds that nothing in section 207 authorizes pari-mutuel bets on horse races "other than in accordance with section 204". A province's betting site therefore has no authority under section 207 to take a bet on a race, fixed-odds or pooled.

What section 204 allows

Section 204 is an exemption from the betting and gaming-house offences in sections 201 and 202. For racing, the key paragraph is 204(1)(c): bets made through the agency of a pari-mutuel system on running, trotting or pacing horse-races are exempt if they are made on the race-course of an association and the section and regulations are complied with. For a race run outside Canada, the governing body that regulates the race must be certified as acceptable and the Minister must permit pari-mutuel betting in Canada on it (subsection 204(8.1)).

Three other subsections shape how betting actually reaches you:

• Off-track betting counts as on-track. Under 204(2), bets made at a betting theatre, or transmitted by telecommunication to a race-course or theatre, are deemed to be made on the association's race-course.
• The system must be federally approved. Under 204(3), no pari-mutuel system may operate on a horse-race unless it has been approved by, and is under the supervision of, an officer appointed by the Minister of Agriculture and Agri-Food.
• The officer can stop betting. Under 204(7), an officer who is not satisfied that the section and regulations are being followed in good faith may stop betting for as long as the officer considers proper.

The Minister's officers work through the Canadian Pari-Mutuel Agency, an agency of Agriculture and Agri-Food Canada. It administers section 204 and the regulations made under it, including the Pari-Mutuel Betting Supervision Regulations (SOR/91-365) and the Pari-Mutuel Payments Order (SI/83-72).

How a pari-mutuel pool pays

A pari-mutuel bet is not priced by a bookmaker. The Supervision Regulations define a pool as "the total amount of money bet on the race" for each type of bet. The association deducts its percentage, often called the takeout, and the rest is shared among winning tickets. Your final price is only known when betting closes.

Section 204(5) says the association may not deduct or retain anything from a pool except as subsection (6) allows, and 204(6) caps the deduction at the percentage prescribed by regulation. Subsection 102(1) of the Regulations sets that ceiling: "the maximum percentage that an association may deduct and retain in respect of any pool is 35 per cent". The percentage an association actually uses is the one in its permit or authorization, and it may differ by type of pool.

Separately, 204(4) requires the operator to pay the Receiver General a fee on each pool of one-half of one per cent of the total bet, or a greater fraction up to one per cent fixed by the Governor in Council. The Pari-Mutuel Payments Order fixes it at "eight-tenths of one per cent". (The Order still cites the provision by its former number, 188(4).)

The table shows the legal limit, not a typical pool. To know what a given bet type returns, look for the association's stated percentage for that pool.

Betting from home: account wagering

Online racebooks in Canada fit into the federal rules through account betting. Subsection 53(1) of the Regulations bars an association from accepting bets by telephone "or by any other means of communication that originates from outside the race-course", except as provided in sections 76 to 99. The Regulations define "telephone" as "any telecommunication device that can be used to record and verify a bet made by an account holder".

Under 76(2), an association may run telephone account betting once it holds a permit and an officer has inspected and authorized its services, facilities and equipment. Section 77(2) then limits whose accounts it may open:

• residents of a province where the association operates a race-course;
• residents of a province where it does not operate a race-course and that has no Commission;
• residents of a province with a Commission, if no races are run there or the Commission authorizes the account;
• persons who reside outside Canada.

That is why the racing brand you can open an account with may depend on your province and its racing commission, not on which sportsbooks operate there.

Who does what

What this means when you bet

• A provincial sportsbook or an Ontario-regulated brand cannot add horse racing to its menu under section 207. Racing comes through a separate, federally supervised channel.
• A race bet in Canada is a share of a pool. You see estimated odds; the price is set when the pool closes, after the deduction.
• Check that the racebook is run by, or for, a Canadian association with account-betting authorization. A fixed-odds horse bet offered outside that channel does not rest on section 204.

Our guides to Ontario and Alberta cover casino and sportsbook options in those provinces, and the responsible gaming page explains limits and self-exclusion.

This is general information about federal law, not legal advice.