The Swedish Trade Association for Online Gambling (BoS) has issued a statement discussing a proposal to implement tighter restrictions on products that involve a higher risk to the player, referring to casino games that have a higher incidence of gambling addiction.
While the intentions are well-meaning, the implications of such measures could backfire and worsen the existing climate for responsible gambling.
BoS objects to certain parts of Svenska Spel’s new proposal calling for tougher measures on gambling
The issue does not stem from the concept of enacting further safeguards against the industry as a whole, but rather, out of a fear that by imposing further restrictions on the regulated market, offshore operators will thrive with an ever-greater number of Swedish players moving away from the market and ending up with websites that are not interested in consumer protection measures.
The proposal pitched by government-owned operator Svenska Spel suggests that online casinos ought to face special restrictions. Such measures would miss their mark and empower the offshore gambling sector, which is gathering steam all across Europe, despite strict regulatory regimes. BOS Secretary-General Gustaf Hoffstedt outlined the association’s fears in a strong argument published on the official website:
"If Svenska Spel’s proposal were to go through, even greater market shares await unlicensed and illegal online casinos. It is a natural consequence if the legally licensed gambling companies are prevented or prohibited from marketing themselves and their products. The proposal that Svenska Spel dresses up in the name of consumer protection would therefore, on the contrary, harm consumer protection, as we know that a transition from licensed to unlicensed gambling entails an increased risk of problem gambling."
Hoffstedt also reminded that Svenska Spel might have a conflict of interest, as measures such as marketing restrictions or an advertising ban could boost Svenska Spel commercially, but this is not tantamount to a safer and more secure market for players.
"This is because the company sells both lottery tickets on the monopoly market and online casino on the competitive market, under the same brand. A ban on advertising for online casinos would mean an enormous advantage for the monopolist Svenska Spel, which then, as the only operator on the Swedish gambling market, can indirectly continue to advertise online casinos via its lottery products," Hoffstedt wrapped up.
Casino Guru's Head of Casino Research, Matej Novota, commented on these developments: "Svenska Spel's proposals are clearly coming from a place of good intentions. Acting more firmly against the unlicensed sector, and ensuring that players are protected, is the essence of what regulatory regimes ought to achieve. Yet, there is a risk vested in over-regulating the domestic market, such as classifying games and flirting with an advertisement ban, as it gradually loses its competitiveness because it finds itself limited in the way it can reach consumers. Offshore operators thrive under these conditions, and the idea that the regulator can ISP block every single unlicensed website has not been successfully implemented in the real world. I agree with BoS's reasons for caution, while applauding Svenska Spel's call to action."
Svenska Spel is guided by a desire to strengthen safeguards for players in Sweden
Yet, Svenska Spel’s proposals are not necessarily seeking to undermine the regulated sector. A chief concern in the opinion shared by the regulator remains the protection of young people. The regulator draws experience from other jurisdictions, calling for restrictions on people under the age of 25, for example.
If anything, Svenska Spel explicitly says that unlicensed operators must be stopped: "In countries such as Denmark, Norway, and Singapore, we can see that DNS blocking works. Sweden should introduce the same possibility to block illegal operators. Without this, new rules for licensed companies risk being ineffective."
As to the classification of some games and gambling as risky, this is something that is long overdue, Svenska Spel believes.
"We know that high-risk gambling, such as online casinos, is strongly linked to debt and problem gambling, while lotteries and sports betting have a significantly lower risk level. Yet all gambling is treated the same in legislation," the operator opined in the article.
"A risk classification in the Gambling Act would make it possible to introduce stricter requirements for high-risk gambling – for example, stricter marketing restrictions and clearer duties of care. This would create a more responsible gambling market where the most vulnerable are better protected," Svenska Spel concluded.
