Sweden Votes Through Gambling Market Re-Organization Bill, Law Takes Effect January 2019

Sweden’s national legislature, the Riksdag, approved Thursday a proposed legislation for the re-regulation of the country’s gambling market. The law is set to take effect on January 1, 2019 and will make it possible for international remote gambling operators to apply for a license from the local gaming authority and operate in a regulated environment.

The new law, titled Re-Regulation of the Gambling Market (En omreglerad spelmarknad), is set to replace Sweden’s Lottery Act of 1994 and Casino Act of 1999. Under the country’s established laws, gambling services can only be provided by several state-run entities, with Svenska Spel being the largest one among these. The gambling monopoly system will be scrapped once the new gambling law is enacted.

The Riksdag approved the legislative piece that sets out the principles and rules under which the Swedish gambling market will be regulated during a Thursday debate. The legislative piece passed by a 282-19 majority. Earlier this week, the bill was approved and referred to the main legislature floor by the Committee on Cultural Affairs.

A secondary gambling legislation is currently being reviewed by the European Commission, and the Swedish Gambling Authority is yet to introduce certain rules related to the regulation of the country’s re-organized gambling market.

Licensing Process

The Swedish gambling regulator, Lotteriinspektionen will begin accepting applications for online gambling licenses from August 1, 2018. The licensing process was originally scheduled to start at the beginning of July, but the regulatory body eventually set the August 1 date as it needed a little bit more time to sort out important regulatory details.

Under the new Swedish gambling law, international betting and gaming operators will be able to obtain licenses as long as they prove eligible for this and ensure that their operations are compliant with the newly adopted regulations.

Sweden has long been targeted by foreign gambling companies as betting and gaming services have been particularly popular among Swedish customers. Operators have also long been criticized by regulators and legislators for their aggressive advertising campaigns across different local media outlets and for operating in the country without contributing tax revenue.

According to a recent report by Swedish market research firm Kantar Sifo, unlicensed gambling operators were among the country’s top 20 advertisers in 2017. Malta-based gambling operator Kindred Group was reported to have spent nearly $55 million on advertising its products to Swedish customers in 2017 and was thus the 9th biggest advertiser. LeoVegas spent approximately $40 million last year to become the 19th biggest advertiser. It is important to note that both gambling companies actually originate from Sweden, despite being based in Malta. The new gambling law will prevent unregulated operators from advertising across Swedish media.

The latest annual report by Lotteriinspektionen showed that Sweden’s unregulated market recorded a double-digit growth in 2017 and represented a quarter of the country’s entire gambling market. Gray market operators generated revenue of SEK5.534 billion last year, while the whole market was valued at SEK22.604 billion.

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