Operator talk: Sweden faces 'three years of limbo' ahead of law changes

Operator talk: Sweden faces 'three years of limbo' ahead of law changes

Thursday, July 23, 2015 Totally Gaming
Lennart Käll is concerned that gaming regulations are not being applied

Svenska Spel chief executive Lennart Käll is concerned that Sweden faces three years of “limbo” before new gaming laws are introduced.

The head of the gaming monopoly told TotallyGaming.com that unrestricted growth and wild marketing spend is creating a environment that could encourage problem gambling issues in the country.

While the Swedish government has vowed to introduce a licensed system by 2018 after the European Commission began taking legal action against it last year, Käll worries that existing legislation that should ban unregulated operators and restrict advertising is not being applied.

“No doubt we welcome new legislation, it is just taking too long,” Käll said. “With the projected timeline of new legislation, that supposedly will come into effect in summer 2018, we face another three years in regulatory limbo.

“Given how fast the internet casino market has grown and emerged as the most problematic form of gambling in Sweden, it might be three very long years for those concerned about the harmful effects of excessive gambling. A large number of internet operators in the Swedish market currently are driving customer and revenue growth through aggressive marketing, such as bonus offerings.

“Last year alone, unregulated operators amassed a staggering SEK2.5bn (€270m/$290m) in advertising spend, accounting for over 70 per cent of the total advertising spend in the market.”

After calling for “swift and concrete measures”, Käll has pointed to action taken in the Netherlands, which is also in the process of implementing a licensed system, as a blueprint for how Sweden should seek to make the transition.

“One possibility, pending a new legislation, is to uphold the current legislation in terms of banning/reducing advertising that promotes unregulated gaming offerings,” he said. “Such a measure is quite attainable, but it comes down to political will and effort.

“I think it would be wise to try to implement measures that will prevent an already very stiff competition to increase even further, measures that would at least cap or freeze the current market situation. Similar action has been taken in the Netherlands, pending their new legislation.”

Käll gave his warning in the same week that the company announced a 2.4 per cent year-on-year drop in net gaming revenue, with SEK4.3bn taken in H1 2015.

Svenska Spel is the only company that is allowed to legally offer land-based and online gambling services within Sweden, and Käll says that its future will only be certain when the government finally releases the details of new gaming laws.

“What the future holds for Svenska Spel I am sure will be addressed alongside the proposed new licensing system and the work that lies ahead in the next couple of years," Käll said.

“We look forward to a new regulation that will create a level playing field for all operators, which is not the situation today, where regulated operators are facing meticulous scrutiny in detail - sales, R&D, marketing - and unregulated competitors pretty much do as they please.”

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