Sweden’s Spelinspektionen Warns: Restrictive Rules to Strengthen Black Market

The proposed measures for deposit limits and session limits effectively restricting the Swedish market are still a hot topic. The country’s Gaming Authority tentatively takes the side of the providers.

Sweden’s Proposed Restrictive Measures Faced with Contradiction

Sweden’s plan for restrictive measures towards the online gambling market has proven a delicate topic. Announced back in April by social security minister Ardalan Shekarabi, the measures set weekly deposit limit of $495 (SEK5,000) and also time limits for Swedish gamblers. The measures were introduced as a part of the country’s plan to enhance player protection while at the same time tackle the coronavirus (COVID-19) outbreak.

Although the measures are premised on helping society and people affected by problem gambling, they’ve been met with a controversial response by industry giants. The Swedish operator association Branscheforenigen for Onlinespel (BOS) prepared a petition which aims at rejecting the proposed measures. So far, the petition was joined by 12 of the gaming operators, which according to BOS secretary general Gustfaf Hoffstedt represents nearly half of the Swedish online gambling market. Among the companies that have already joined the petition are: NetEnt, William Hill, Kindred Group, Betsson.

Sweden’s Gaming Authority Takes the Side of the Online Gambling Suppliers

Currently, even Spelinspektionen, which is Sweden’s Gaming Authority, has expressed concern about the positive effect of the newly planned restrictions. The Gaming Authority pointed out that although they generally agree implementing rules that enhance player protection, such measures might also have a negative effect on the market if implemented in a hurry. Spelinspektionen noted that such negative effect would be reduced channelization, which is currently around the 75% mark instead of the 90% planned by the Swedish government.

Furthermore the Gaming Authority pointed out that a limit of $495 a week is too restrictive of an amount. Based on numbers from 2019, Spelinspektionen showed that the average loss per citizen is $310 (SEK3,043) for the whole year. The gaming authority continued that based on the numbers, it turns out that small percantage of the players make a significant part of the total revenue: “At the same time, a smaller proportion of players (between 5% and 25%) account for the majority of the gaming market’s total turnover (80% to 90%), which means the majority play with significantly lower amounts.”

The Response of the Online Gaming Industry

Kindred Group CEO, Henrik Tjärnström has said that the company is really concerned about the Swedish market climate. He noted that he is seeing an alarming tendency of market reduction which is actually confirmed by Copenhagen Economics as well as the Swedish Agency for Public Management (Statskontoret). In his own words, Tjärnström noted: “We need to be careful about introducing regulations that move customers away from regulated gambling companies towards unlicensed sites where Swedish authorities have no ability whatsoever of ensuring a high consumer protection. This is a negative development for customers, for the licensed gambling companies, and for society as a whole.”

Svenska Spel CEO Patrik Hofbauer also commented on the subject. He deemed the current restrictions to be sufficient enough considering current risk gambling trends. Hofbauer shared Tjärnström’s opinion that more restrictive actions towards online gambling might result in users choosing the unlicensed market. In his own words, Hofbauer noted: “Now, gambling addiction flags for people with risk behavior to seek beyond the licensed gaming market. This is a problem that is not solved by restrictions on the licensing market, but by the authorities taking the hard gloves against gaming companies that provide illegal gambling.”