Sweden’s State-Run Gambling Operator Demands Fair Competition Rules upon Market’s Regulation

The results from a year-and-a-half-long review of Sweden’s gambling industry were published this spring, recommending the replacement of Svenska Spel’s monopoly over the provision of licensed iGaming services with a more liberal licensing system that would admit international operators to the local market.

It is now up to Sweden’s Riksdag (the country’s legislature) to craft a new legislative framework and to introduce it as a law. It was originally announced that the new regulatory regime would take effect in early 2019. Although it is yet to be seen how exactly the country’s gambling market will be regulated, discussions on the matter and even exchange of criticism have already emerged between involved parties.

Earlier this month, Svenska Spel CEO Lennart Käll and Chairman Erik Strand wrote an opinion piece for Swedish news outlet Dagens Samhälle, dwelling in greater detail in what Sweden’s future gambling laws should include. According to the two gambling officials, there are two main points lawmakers need to keep in mind when crafting the new regulations – minimization of problem gambling risks and the introduction of effective mechanisms against illegal gambling.

The Svenska Spel’s top executives pointed out that when the market is opened for international operators, these need to be scrutinized carefully before being granted licenses from local regulators. The state-run operator itself will be watching the industry’s development once the new regulations are in place and will engage itself in ensuring that services are provided in a proper manner.

The two officials recommended that the government pay special attention to the different types of gambling services and to the fact that different games pose different level of risk to customers. Thus, the regulatory framework should be developed in a manner that encompasses effective mechanisms for all levels of risk.

Despite being the only authorized operator of iGaming services in the country, Svenska Spel currently holds only a fifth of the local online gambling market. In comparison, gray market operators have been taking a larger and larger portions of revenue from local customers for the past several years. Svenska Spel called for the creation of regulations that would secure fair competition for all participating parties. According to gaming operator, the criminalization of licensed activities would be a good measure to be implemented.

The publication of Mr. Käll and Mr. Strand’s piece was followed by an article produced by Fredrik Schulte, known to be a Member of Sweden’s Parliament. Mr. Schulte was critical of the two gambling executive’s piece, arguing that it is now up to the legislature to determine how the industry will be regulated and that Svenska Spel should not try to influence the course of events. Mr. Schulte further noted that the state-run operator may be trying to direct the industry’s regulation in a manner that would benefit Svenska Spel itself once the new rules are implemented and will give it advantage over its international competitors.