spelinspektionen.se

New Shortened Licenses Being Issued By Spelinspektionen

Article by : Helen Oct 29, 2020

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Spelinspektionen is the authority in Sweden that controls and regulates the gaming industry in this country. It ensures this particular market is legal, secure and it also contributes to downsizing the risks of harm for society.

In 2019 the new Swedish Gambling Act and the Swedish Gambling Tax Act came into force and since that time everyone who wants to offer gaming services must obtain the license. The new rules are applied to the games that are available on Sweden’s gambling market, including Lottery and Bingo, Betting, Horse Racing, Slot Machines, and Casinos. On the other hand, parlor games, computer games, and games for amusement are the exceptions. Gambling providers can apply for six different kinds of licenses such as:

1. Betting
2. Games reserved for public purposes
3. Commercial online games
4. Land-based commercial games
5. Games reserved for the State
6. Games on ships in international traffic

The validity of the above-mentioned licenses may not exceed five years, and once the license expires an operator may apply for a new one providing it fulfills all the requirements.

However, Sweden’s Gaming Inspectorate has recently made a comment on the influence of licensees’ financial state on licence terms. It was incited by the fact that some applicants were issued licenses for one year only. The reason for this was negative equity in the subsidiary companies through which the gambling operators applied their applications.

The negative equity means the subsidiary companies didn’t have supporting capital or even owed more than they were worth. In most cases, the operators’ subsidiaries receive financing from the parent companies. Not to mention the five biggest gambling companies in Sweden by their turnover. This list includes Svenska Spel, Betsson, Trav Och Galopp (ATG), Veo Vegas, and Cherry.

Spelinspektionen (Sweden’s Gaming Inspectorate) changed the licence terms and limited their number including even the licenses issued to Aspire Global and Gaming Innovation Group. These operators applied to the Administrative Court of Linkoping for appealing against the regulator’s decision. Cherry is also one of those companies whose subsidiary was granted a two-year license. They decided to challenge Spelinspektionen’s decision but the court rejected their submission and ruled that Spelinspektionen has the right to shorten the license term.

Spelinspektionen claimed they will take into account the court’s decision and will be issuing three-year licenses to companies that are in negative equity. According to the Gaming Act, the operator must have a sound financial structure. In case it has a capital guarantee but doesn’t meet the requirements of the above mentioned Act and remains in negative equity, Spelinspektionen wouldn’t renew the license.

As far as the regulations are going to change, the regulator modifies the way of issuing licenses. The process of changing regulations is a lengthy development period which may take several years until it completes.

Being in negative equity is not the only reason for getting a shortened license. Spelinspektionen has the right to limit the license if a gambling company doesn’t adhere to the regulations. Thus the Mandalorian Technologies’s license issued in 2019 was shortened after the company had broken bonus rules. Instead of a five-year license, they have got a two-year only. Moreover, there is an additional punishment for Mandalorian and it must pay a fine of $ 1 million dollars. The operator had made an application to the Administrative Court of Linkoping and as a result, its license was extended for one year, meaning it covers the period to January 2022. However, the court confirmed that the penalty must be paid.