Amended Swedish Gambling Act to expand definition of illegal gambling operators
Investigator Marcus Isgren has proposed the removal of the current “directional criterion” from the Swedish Gambling Act.
Sweden.- The government-commissioned review of the Swedish Gambling Act of 2018 has concluded with a proposal to clarify and expand its scope of application. Investigator Marcus Isgren, who was appointed in February to lead the review, has proposed in his report that the legislation be amended to remove the “so-called directional criterion”, under which only online games specifically aimed at the Swedish market are covered by the law.
This detail of the act has led to enforcement challenges for the Swedish gambling regulator Spelinspektionen, which has found itself only able to take action against unlicensed operators if it can find evidence of them targeting Swedish players, for example, by using the Swedish language or listing Swedish krona as a payment method.
Under Isgren’s proposal, instead of focusing on whether an online game is aimed at Sweden, the scope of application of the Gambling Act would be based on a participant perspective, where the decisive question is whether persons who are in Sweden can participate in the gaming offer.
That would mean that in order not to be covered by the Gambling Act, online gambling companies would be required to “take appropriate and effective measures to prevent participation from Sweden”, such as geoblocking.
The purpose of the new regulation is to exclude unlicensed gambling in a more effective way than is currently possible and to protect the interests underlying Swedish gambling regulation, including strong consumer protection and the prevention of crime in connection with gambling for money, Isgren’s report states.
The memorandum also proposes expanding the Gambling Act’s ban on promoting participation in illegal gambling to include the provision of payment solutions and other similar financial or administrative services to gambling companies. It would no longer matter whether such a service is specifically developed for the gambling industry.
In addition, it is proposed that a presumption rule be introduced in the Gambling Act linked to the promotion ban. Anyone who mediates payments to or from a gambling business that provides illegal gambling would have to assume that persons participating in the game are doing so from Sweden, if the person is resident or permanently residing in Sweden. Only if it is clear that the person is participating in the game from abroad should the presumption be broken.
It is also proposed that the criminal liability for the crimes of illegal gambling and promotion of illegal gambling should be adjusted.
“The purpose of these legislative amendments is that the expansion of the Gambling Act’s scope of application should have the greatest possible effects, especially when it comes to stopping payment flows between Swedish consumers and illegal gambling,” the report states.
It’s proposed that the legislative amendments enter into force on January 1, 2027.
The state-controlled gambling operator Svenska Spel immediately welcomed the proposals.
President and CEO Anna Johnson said: “The investigator’s proposals are long-awaited and welcome. We have long pointed out that the regulations regarding illegal gambling need to be tightened. It is about improved protection for consumers, but also about safeguarding confidence in the entire Swedish gambling market. That gaming is conducted in a responsible and sustainable manner is the very foundation of our business.
“It is absolutely necessary to continue with more measures to counteract illegal gambling. DNS blocking of illegal gambling sites is a natural next step to move forward with. This would further strengthen the Swedish licensing market as well as the protection of Swedish consumers.”
Earlier this year, a Swedish court quashed an injunction issued by the national gambling regulator Spelinspektionen against the payment provider Zimpler due to a lack of “concreteness” in the definition of illegal gambling offerings in the Swedish Gambling Act of 2018. The court noted that the wording of the legislation states that operators are only deemed to be targeting Swedish players if they use the Swedish language or list the Swedish Krona.
