Sweden To Liberalize its iPoker Market By Jan 1st 2019

On June 7, 2018, the Swedish legislature, the Riksdag, approved a new gambling law that opens up the Swedish online poker market to licensed firms. The bill, entitled “Re-Regulation of the Gambling Market,” passed in a vote of 282-19. The license application process is scheduled to get underway on August 1 with the newly approved organizations beginning their operations in Sweden starting January 1, 2019.

In addition to liberalizing the country’s online gambling market, the two main objectives of the new statute is to ensure player safety, and also to punish all unlicensed operators.

About the New Law

The “Re-Regulation of the Gambling Market” purports to do exactly what the title says as opposed to many other pieces of legislation that have been enacted around the world (USA SAFE Port Act, anyone?). It will liberalize the rules for Swedish gambling, which is currently dominated by state-run monopoly Svenska Spel.

The law calls for a tripartite division of the real money gaming economy in the Nordic nation:

– A competitive sector: online poker and other internet betting
– A nonprofit sector: charitable lotteries, bingo and the like
– A government sector: primarily state-owned casinos

Because poker games hosted on the internet are included in the competitive sector, any properly licensed entity will be able to offer them to Swedish citizens. The games won’t be ring-fenced, so Swedes will be able to play against their counterparts around the world. Gross gaming revenue will be subject to an 18 percent tax.

Customer Protection Important

One of the key components of the recently passed legislation is consumer protection. Restrictive rules on gambling marketing will be implemented, and businesses will have to allow users to self-exclude. The minimum age for gambling is set at 18.

In a controversial clause, online wagering services will be precluded from offering free bonuses apart from a single welcome bonus. This might cause some online poker rooms a bit of hassle because it’s common for them to offer redeposit and no deposit bonuses to existing players. Still, the impact of this prohibition probably won’t be too severe because the affected organizations can easily convert their existing promotions to rake races or leaderboards to get around this restriction.

Revenue Protection no Less Important

The other prong of the new gambling regulations involves cracking down on unlicensed gaming. The Swedish Gambling Authority will have the power to force ISPs to display warnings whenever anyone in Sweden visits the site of an unlicensed gambling provider. Moreover, there are plans to block gambling payment transactions to these companies although we must note that similar schemes in other countries have been easily circumvented in the past. Nevertheless, the promotion of illegal gambling will become a crime.

History of the Swedish Gambling Market

Gambling in Sweden was previously covered by the 1994 Lotteries Act and the 1999 Casinos Act. They set up rules mandating that all gambling activity in the country had to be licensed. How this actually played out in practice was that no entity was licensed for commercial gaming except those run by the central government, or specifically Svenska Spel.

Svenska Spel began in 1997 through the merger of two state companies. It sells lottery tickets through a network of agents and also manages Sweden’s handful of brick-and-mortar casinos. In time, the monopoly extended its reach to the internet, and it now hosts sports betting, bingo, lotteries, casino games and, of course, poker tables online.

Swedish courts have consistently upheld the country’s restrictive gaming laws against many challenges. However, the same has not been the case at the transnational level. Way back in 2007, the European Union warned Sweden that its failure to abide by its treaty obligations to allow cross-border access to goods and services was unacceptable. This and other warnings were mostly ignored by the Swedish authorities.

However, in 2013, the EU commenced serious action against Sweden and several other nations that were held to be violating trade agreements. The matter ended up in the European Court of Justice, which must have scared the Scandinavian nation because it requested time to come up with new gambling laws. The “Re-Regulation of the Gambling Market” will bring Sweden into compliance with all relevant EU guidelines.

Effects of the New Law

Sweden is not an economic giant by any means with a small population of just over 10 million. However, it is prosperous with an annual income per resident in excess of $50,000. Estimates of the size of the Swedish gambling market are in the ballpark of $2.5 billion per year. About a quarter of this total comes from unlicensed gaming. By establishing a licensing framework, the Swedish government will be able to capture a lot of revenue that currently escapes the taxing authorities.

It’s tougher to gauge the impact of licensed Swedish online poker on the overall industry. The addition of such a small player base to the worldwide poker economy might seem unremarkable at first glance. However, it appears that Sweden’s populace is extremely fond of cards. The only currently legal site, Svenska Spel, operates in just this single country; yet it has enough player traffic to rank as the 15th-largest poker site in the world.

Though small in numbers, Sweden has a big love for poker. Just look at all the prominent players who hail from within its wintry borders: Viktor “Isildur1” Blom, Martin Jacobson and Chris Björin among others. Maybe with the enacting of this gambling liberalization law, we’ll see a new generation of successful Swedish grinders rise up and join the ranks of these luminaries.