Swedish gaming regulator warns Betway over negative equity

Spelinspektionen has warned Betway for breaching Swedish licensing rules on minimum equity.

Sweden.- The Swedish gaming regulator, Spelinspektionen, has issued a warning to the gaming operator Betway for breaching rules on operators’ minimum equity.

The regulator had requested a copy of Betway’s annual report and auditor report for the 2019 financial year, in which it reported a €50.3m loss and negative equity of €4.8m.

The Malta-based parent company, Betway Group Limited, had reported a €42.4m loss and positive equity of €49.9m, and the subsidiary Betway Limited Consolidated Limited Group, a €60.4m loss and negative equity of €13.8m.

Malta’s Companies Act allows negative capital if a company can offer proof that it is able to continue to run. Betway submitted a capital guarantee from its parent group to Spelinspektionen in October detailing how it would improve its negative equity, but Spelinspektionen ruled that Betway “lacks its own capital base” and is “completely dependent” on support from the parent company.

Spelinspektionen said the capital guarantee “only partially” compensates for the company’s negative equity. As such, Betway was found to have breached chapter 4, sections 1 and 3 of Sweden’s Gambling Act on the obligation for licensees to prove themselves suitable to hold a licence.

Spelinspektionen described the breach as minor but has issued a warning.

Back in December, it fined Betway SEK100,000 (€9,800) over an unintended error that opened a bonus campaign to all customers, when only new sign-ups may receive bonuses under Sweden’s rules.

See also: Betway signs multi-year deal with Toulouse Football Club