Rapid expansion observed in Swedish online gaming sector
In a recent quarterly analysis, the Swedish gambling market exhibited a notable increase in online gambling activity. The internet gaming sector saw a growth of 13%, while offline casino establishments experienced a decline in revenue of 3%. The rising calls for the dismantling of the Swedish gambling monopoly are becoming more prominent.
On the 13th of April 2017, the Swedish Gambling Authority, known as "Lotteriinspektionen", released their official statistics. The Swedish market generated a revenue of 5.4 billion crowns (around 552 million euros) by the end of March 2017, marking a 0.2% increase from the same period last year. Unnervingly, 53% of the online market's growing revenue came from internationally licensed providers.
The Rise of Online Gaming in Sweden
What's most noteworthy is the rapid growth of internet gambling providers. These companies serving the Swedish market reported a surge of 13% in revenue to 1.25 billion crowns (around 128 million euros). Meanwhile, domestic brands regulated in Sweden, such as "Svenska Spel", experienced a 3% decline in sales to 4.2 billion crowns (approx. 430 million euros), despite an increase of 6% in their online profit to 519 million crowns (around 53 million euros). Likewise, ATG, the company responsible for horse racing betting, had a turnover of 954 million kronor (about 97 million euros), with the online market expanding by 10% to 536 million kronor (nearly 55 million euros) as its offline revenue sank by 10% to 417 million kronor (or about 42 million euros). Sweden's largest lottery, "Svenska Postkod Lotteriet", reported a sales increase of 3%, with online offers in particular enjoying a 23% boost but still representing a relatively minor share.
The Future of the Swedish Gambling Market
To date, there has been a Swedish gambling monopoly enforced in the online market. Only "Svenska Spel" is authorized to provide internet gambling in Sweden. Unlicensed EU companies may also offer their services in Sweden, creating a shady legal limbo. In late March 2017, some industry experts recommended deregulation and opening the market. The report recommended a 18% tax on providers' gross revenues, higher than the 15% US system but lower than Denmarkâs 20%. The authors emphasize:
With a 18% tax rate and a non-excessive regulatory burden, the study anticipates a regulatory rate of 90% in the competitive market.
This proposal has found favor amongst private operators, as well as "Svenska Spel" and the horse betting sector. If this proposal is accepted and passed into law, the Swedish market might be regulated as early as January 2019. A draft law needs to be submitted to the European Commission first, then voted upon in Parliament at the end of 2017, then finally put into effect in mid-2018, taking into consideration any transitional periods needed for obtaining and granting licenses.
Regarding Germany, this method could provide a blueprint for reforms in their gambling market, as similar issues have arisen concerning the regulation of internet providers due to the state gambling monopoly. In Schleswig-Holstein, the liberalization of the gambling market was a significant issue during the 2017 elections. Positive experiences in regulating the industry in other EU countries may motivate a German government to make adjustments in this area, leading to increased tax income for the state and tighter regulations to safeguard players from the dangers of gambling.
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Source: www.onlinecasinosdeutschland.com
