IAB Canada continues to remain at the forefront of policy developments, and we continue to engage government and advocate for our members and industry. Our current priorities include Bill C-27, The Digital Service Tax (DST), age assurance, and illegal operators in the Ontario online gambling ecosystem. Following are some updates on our actions on those files.
C-27 – Legitimate Interest, Age Assurance, and the Tribunal
IAB Canada recently submitted a letter to the Hon. François-Philippe Champagne, Minister of Innovation, Science and Industry addressing several concerns with Bill C-27, starting with s.18(3) – Legitimate Interest, age assurance, and the necessity of the Personal Information and Data Protection Tribunal. Bill C-27 fails to recognize digital advertising as a legitimate interest. We have argued that small to medium-sized enterprises (SMEs) rely on digital advertising to grow and expand and consumers have come to expect and appreciate personalized advertising through digital channels. Unless digital advertising is seen as a legitimate interest it will inevitably move into an incessant opt-in consent model and all but guarantee consent fatigue. In addition, the industry could lose a conservatively estimated 40% of its ability to track and measure ads.
With regards to the OPC consultation on age assurance, IAB Canada has warned that if all the personal information of minors is considered sensitive, then an organization would need to collect far more information than necessary just to confirm the age of a user. The bill would as a result, nullify what it intends to achieve. We’ve made it clear to the government that we agree with the spirit of C-27 and there are better ways to protect the personal information of minors without making the user experience more onerous.
We also expressed our agreement with the creation of the Personal Information and Data Protection Tribunal. The Tribunal would ensure a greater distinction between the roles of investigation and adjudication when it comes to privacy violations and would protect against the consolidation of power into the hands of the Commissioner.
Lastly, for C-27 to be the most effective, it must be implemented through a phased-in approach. IAB Canada suggested that this occurs over a period of three years, allowing for the allocation of resources gradually, leading to eventual total compliance.
You can read our full letter to Minister Champagne here.
Digital Service Tax (DST)
IAB Canada sent both a letter and a follow-up email for urgent response to the Hon. Chrystia Freeland, Deputy Prime Minister and Minister of Finance communicating our most pressing concerns. Particularly, retroactivity and the issue of pass-through costs. We have emphasized what our members have been telling us: That the retroactivity provision will necessitate massive compliance costs and set a dangerous precedent in tax law. We have consistently asked for its removal and communicated the issues our industry faces as a result. Inconsistency in disclosures on pass-through costs in the wake of the DST is inviting market pricing obfuscation in its current manifestation. The lack of transparency will impact our entire sector and is already causing massive confusion with agencies and SMEs not knowing whether their ad costs reflect true market conditions or are a result of baked in costs due to affected organizations passing through the costs of the tax.
IAB Canada secured a meeting with Minister Freeland’s office and communicated all the above issues and raised our concerns regarding retaliatory actions from the US which are sure to follow. To combat the potential for obfuscation, we suggested that the registry of businesses impacted in our sector be made public.
You can read our letter to Minister Freeland in full here and access our DST infographic here.
Illegal Operators in Ontario Online Gambling
While iGaming has represented a tremendous new market for the online ad sector, we continue to take calls from the AGCO regarding the concerns of illegal entities operating in Ontario. Last week, the Alcohol and Gaming Commission of Ontario (AGCO) contacted IAB Canada reiterating these concerns. 14% of Ontarians are still playing exclusively on illegal sites while another 20% are using both legal and illegal sites.
The AGCO has requested that IAB Canada encourage our members to disallow ads of unlicensed online gambling sites and has provided a live list of fully regulated Ontario iGaming operators which can be found here (hyperlink). While we encourage our members to follow suit, to be the most effective we request that the AGCO release a comprehensive block list of all illegal sites. This would act as an immediate deterrent in preventing access to known illegal sites and would signal that these sites are unauthorized and risky. As it currently stands, organizations would need to use AI to identify a gaming ad and then cross-check an allow list before accepting the ad. A block list would allow for the immediate rejection of an ad from an illegal site.
At risk, is tightening regulation impacting iGaming as illegal sites further erode the economic benefits to Ontario. While IAB Canada does not intent to monitor this activity, it is important to communicate the concerns to our members who are better positioned to help manage this reality on the ground. iGaming advertising represents a significant revenue opportunity to our sector, we would like to ensure its stability.
We will continue to monitor these developments and stay at the forefront of advocacy for all our members and stakeholders. If you would like to know more, please contact [email protected].