The Sweden legislature has passed a gambling bill that will end the county’s long-standing gambling market monopoly.

Bill details

On Thursday, Sweden’s legislature, the Riksdag, comprehensively approved a new gambling bill that will re-regulate the sector. The bill, which was overwhelmingly passed by a vote of 282 to 19, will come into place on January 1, 2019.

The main takeaway from this new bill is that international gambling companies will now be able to apply to gain a license from the country’s gaming authority and operate as regulated entities in the region. Previously, only a monopoly of state-run entities were permitted to offer gambling services in the country.

The new “Re-Regulation of the Gambling Market” bill, which replaces the Lottery Act (1994) and the Casino Act (1999), had previously been approved by the Committee on Cultural Affairs and was subsequently debated and voted on in the Riksdag on Thursday for the final seal of approval.

Secondary legislation still needs to be approved by the European Commission, and there may be further additions to the rules and regulations made by the Swedish Gambling Authority.

The bill’s approval came just days after the authorities in Norway had submitted a bill to the European Commission that would maintain the country’s state-run gambling monopoly.

Bill consequences

Online gambling license applications can be made via the Lotteriinspektionen (the gambling regulator in Sweden) beginning on August 1, 2018. The opening up for applications was previously set for the beginning of July, but it is estimated that more time will be needed to ensure that vital regulatory details are in place.

The licenses will cost ￡34,000 ($45,000) each, and if a license is required for online gambling and betting, this fee rises to ￡60,000 ($80,000).

Once international gambling operators are eligible and compliant with all the relevant regulations, they are welcome to apply for a license. Sweden has long been a nation that enjoys its gambling, so international companies have been eyeing it up as a lucrative market for some time now.

The authorities in the country have in the past frowned upon these international companies for their efforts of aggressively targeting their citizens with advertisements, both online and through local media. They also were not pleased that they were not paying any taxes to the Swedish state despite their activities.

A report prepared by Swedish market research firm Kantar Sifo revealed that the biggest advertisers in 2017 were unlicensed gambling operators: the Kindred Group ($55m advertising spend) and LeoVegas ($40m advertising spend), ranked 9th and 19th respectively.

Of course, both of these companies originally started out in Sweden but are now based in Malta. As part of the new bill, unlicensed operators will not be allowed to advertise in Swedish media.

While the monopoly has ended for the state-run gambling operators in Sweden, the annual report of Lotteriinspektionen showed that approximately one-quarter of the country’s total gambling market revenue was attributed to unregulated operators. This amounts to revenues in the region of ￡471m ($631m) out of a total market revenue figure of about ￡1.9bn ($2.55bn).

Therefore, once these unregulated entities become licensed, Sweden will be able to get its cut in the form of tax revenue, which it previously missed out on. In addition, better protection will be provided to users of these previously unregulated sites as a result of them receiving licenses.

It is obvious that this bill is being widely backed in Sweden, having taken quite some time to come to fruition.

Speaking to this reporter, Jenny Nilzon, CEO of the gaming ethics council in Sweden Speletiska R?det (Sper) said: “The situation in the Swedish gambling market has been unsatisfying for a long time, where a non-functioning legislation has been a critical part. The fact that Parliament now decided to adjust the regulation after a modern and digital world is very much appreciated.”

She went on to say: “Even though our members already have permission in Sweden they are keen on getting a new legislation in place. It is crucial if we really want to have a sustainable market where consumers’ protection and needs are in focus. It’s a milestone reached today.”