BOS Advocates Tougher Rules on Sweden’s Unlicensed Gambling

The Swedish Trade Association for Online Gambling (BOS) has strongly supported a recent recommendation by the National Audit Office (NAO) to reassess Sweden’s Gambling Act. The call for review highlights gaps in regulatory oversight that allow unlicensed operators to bypass the system, underscoring the need for legislative improvements to curb illegal gambling activities.

The NAO's investigation focuses on the Swedish Gambling Authority’s (SGA) inability to regulate the entire market effectively. The report emphasizes how certain unlicensed operators continue to offer services in Sweden despite the legislative framework, often taking advantage of specific loopholes. BOS, echoing these concerns, has long advocated for a more expansive scope within the Gambling Act, ensuring that unlicensed operators no longer exploit such weaknesses.

Loopholes in Sweden’s Gambling Law

One of the central issues raised by the NAO and BOS is a loophole in the current Gambling Act, which defines illegal operators based on the language and currency they use. Under the existing law, operators offering gambling services in English or using euros are not classified as illegal, even if they lack a Swedish license. Conversely, companies that provide services in Swedish, use the Swedish Krona, or offer Swedish-speaking customer support are deemed illegal if they operate without a license.

This inconsistency has allowed unlicensed operators to continue targeting Swedish consumers, a practice that BOS Secretary General Gustaf Hoffstedt believes is untenable. Hoffstedt stressed the urgency of closing this gap, stating, “That today’s gambling legislation allows such extensive parts of the gambling market to operate without a license is unsustainable.”

Expanding the Gambling Act's Reach

BOS has been calling for an expansion of the Gambling Act for years, a stance reinforced by the NAO’s recent findings. Hoffstedt reiterated that broadening the scope of the law would make it illegal for unlicensed gambling companies to serve Swedish consumers, forcing them to implement geo-blocking measures for Sweden. He welcomed the NAO’s support, noting, “It is very welcome that the National Audit Office reasons in a similar way in the report.”

The trade association agrees with the report’s stance that more stringent penalties should be imposed on unlicensed operators targeting Swedish customers. This would align with the original intentions behind the Gambling Act—creating a safer and more regulated environment for gambling in Sweden.

SGA’s Oversight Under Scrutiny

The NAO’s report also highlights several shortcomings in the Swedish Gambling Authority's supervision of the gambling market. The regulator has been criticized for conducting too few inspections and not basing its actions on thorough risk assessments. Additionally, the SGA has failed to follow up adequately on its supervisory decisions, which undermines the effectiveness of the regulatory framework.

Deputy Auditor General Claudia Gardberg Morner pointed out the need for enhanced oversight, especially concerning high-risk gambling activities such as online gaming and betting. The lack of proper regulatory actions against unlicensed operators has also contributed to the growth of a "grey market" in Sweden, which has complicated efforts to regulate the sector.

Calls for Resource Allocation and Clearer Legislation

The report also emphasized the need for better resource allocation within the SGA. The regulator has struggled with its expanded responsibilities since the introduction of Sweden’s new Gambling Act in 2019. Hedvig Tängdén, project leader for the audit, noted that the authority’s lack of systematic risk analysis has further hindered its supervisory capabilities. Without enough resources, the SGA has been unable to maintain effective oversight, leading to gaps in regulatory enforcement.

Adding to these challenges is the ambiguity within the Gambling Act itself, which has made it difficult for authorities to determine when a license is required. Gardberg Morner called on the government to clarify these legal aspects, which would help streamline the supervisory process.

Industry Response and Future Outlook

In response to the audit, BOS has reiterated its stance on expanding the Gambling Act’s application. The organization remains firm in its belief that unlicensed operators should not be allowed to target Swedish consumers and that the legislative framework must be adjusted to address this issue.

The SGA has acknowledged the NAO’s report and admitted there is room for improvement in its oversight. Camilla Rosenberg, the authority’s director general, described the re-regulation of the gaming market as a "revolutionary" process but also noted that the authority has made several organizational changes in recent years to enhance its operations.

Looking ahead, the SGA has received additional funding for 2024, which Rosenberg described as essential for improving the authority’s performance. The SGA has also outlined plans to prioritize risk analysis and system enhancements to better adapt to the evolving gambling landscape.

As the push for clearer legislation and stronger regulatory frameworks continues, both the NAO and BOS hope that these measures will significantly improve Sweden's gambling market, ensuring that consumers are better protected and that unlicensed operators are held accountable.

Source: BOS urges review of Sweden’s Gambling Act to combat unlicensed operators, World Casino Directory, October 22, 2024.