Reregulation of the gambling market

Presently the most important issue is to bring about a sustainable gambling regulation. An outdated monopoly should be replaced by a licencing system. In recent years, we have happily noted growing public and political support for the introduction of a licensing system. Several of the monopolized gambling companies also want a licensing system and almost all major political parties are looking to introduce it.

Government action is necessary to achieve real change, and appreciate the government’s initiative to re-regulate in favor of gambling licenses.

While we support a licensing system, we recognize that it must be sustainable in the long term. The key here is channeling. Significant channeling means customers use gambling companies that operate within the licensing system. A low level of channeling would mean the deregulation has failed, as customers have chosen to move beyond the regulated market. The channeling rate exceed 95 percent in order to work well.

A prerequisite for the system’s success is that gambling companies – or rather their customers – find the licencing terms acceptable. Gambling offers from outside the licensing system are never more than a click of away.

We would like to list ten points that we consider necessary for a successful reregulation.

  1. It’s essential that all gambling products are included in the licence system or else customers will go elsewhere, such as to the black market.
  2. A licencing system must treat all operators equally. Special treatment should be avoided and a level-playing field maintained.
  3. Gambling companies should be taxed based on their net gambling revenue, i.e. after payments have been made to customers in the form of winnings and bonuses. The tax rate should promote a high level of channeling and good revenue opportunities for the government and the sports community.
  4. The government’s operational responsibility for the licencing system should be centralized to a new gambling agency. It should be responsible for surveillance, licensing, sanctions and gambling-related research.
  5. It’s rarely a good idea to be both player and referee at the same time. The government should therefore sell off AB Svenska Spel and leave the board of ATG, and instead commit itself exclusively to making and enforcing gambling laws.
  6. All companies that meet the government’s requirements should be granted a licence. There should be no cap on the number of licences.
  7. Sweden should have common requirements concerning responsible gambling. Examples of such requirements are: identity control, support and information on the gambling websites to prevent gambling addiction, balanced marketing and a central self-exclusion register. Furthermore, requirements to combat money laundering and match fixing should be established.
  8. The level of return to players (the winnings) should be determined by the gambling companies and reflect the differing business models within the sector. A departure from this principle would have serious consequences for channeling and result in lower value for consumers. The licence system should specify neither a floor nor a ceiling.
  9. The government should implement a right to treatment in accordance with the Social Services Act for gambling addicts, similar to what the law states for other addictions with medically established diagnoses.
  10. The black gambling market is excluded by creating a licence system that is attractive for both gambling companies and their customers. The sustainability of the system will be decided by its attractiveness and not by attempts to erect obstacles, such as blocking IP addresses and credit card transfers. Ultimately the customers decide.