SBC News Voice of the Sports Betting Industry
Svenska Spel, Sweden’s state-owned betting and gaming company, cannot get a break at the moment, having been placed under supervision by the country’s gaming inspectorate, Spelinspektionen.
The regulator has initiated a review of Svenska Spel, alongside state-owned racing body AB Trav och Galopp (ATG) and Malta-based lottery brokerage app Lotto Direct Ltd, to check compliance with the Swedish Gambling Act of 2018.
Spelinspektionen’s scrutiny is particularly focused with one specific section of the Gambling Act, this being a requirement that licence holders notify the regulator of any changes in an application or registration.
The regulator states that it will publish the results of the reviews when a decision has been made. This will include any decisions around an intervention, which could range from anything to a warning to extra licence conditions to a fine or penalty.
While nothing is concrete, the timing of this investigation is not ideal for Svenska Spel in particular, coming just three days after the operator won a landmark court decision against a Spelinspektionen court decision.
Svenska Spel and Spelinspektionen – a long-running battle
The recently solved legal spat between Skolinspektionen and Svenska Spel dates back to 2021 when the regulator conducted an audit 17 October-17 December including an examination of 10 customers who had lost money during that period.
The audit concluded that Svenska Spel had not acted proactively enough in preventing harm and potential problem gambling among the 10 customers examined. The firm was criticised as being too ‘passive’ in implementing its duty of care policies, particularly due to the players in question already being classified as high risk.
All 10 players had high deposit limits, made large deposits and incurred large losses, while also making several deposits a day and playing frequently, including at night. Some had also excluded themselves from certain games.
In March 2024, the regulator issued Svenska Spel a SEK 100m (€90,000) penalty for failing to meet the duty of care standards of the 2018 Gambling Act. Svenska Spell responded to this with an appeal, which the Administrative Court in Linköping recently reached a decision on.
A milestone moment
In a rare case of a court siding with a gambling firm against a regulatory decision, the Linköping Court ruled against Spelinspektionen’s decision. This decision was based on the fact that Svenska Spel had taken ‘several gambling liability measures’ against the 10 customers including access limitations and restrictions.
The interventions showed that the operator had been taking action against the customers’ excessive gambling, the court stated that it could not share the same opinion of Spelinspektionen. The court also stated that it does not believe it was sufficiently clear that Svenska Spel had failed to avoid the penalty.
“It is gratifying that the Administrative Court upholds our appeal and overturns the decision of the Swedish Gambling Authority,” said Fredrik Wastenson, CEO and Business Area Manager at Svenska Spel Sport & Casino AB.
“We appealed because we believe that the penalty fee is disproportionate in relation to the shortcomings and because there is a need to create greater clarity in the interpretation of the duty of care.
“We believe that the authority may only take measures that are supported by the legal order, the so-called principle of legality, which the court has also stated.”
However, the resumption of an investigation into Svenska Spel for potential compliance failures shows that the regulator is not out of the woods yet. Though this review is not related to the previous audit and penalty, it does demonstrate the relentlessness of regulation in this industry.
In the background, Sweden’s Tidö Coalition government has yet to present a formal plan to split Svenska Spel’s business.
The coalition supports a proposal to divest Svenska Spel’s online gambling and sports betting division to the private sector, while retaining its lottery and keno operations as a state monopoly. The initiative is backed by the Moderate Party and the Sweden Democrats, who argue that the state should not be involved in competitive online gambling.
