May 23, 2008

Sweden stalls as Svenska Spel sell-off discussed

Petter Nylander, chief executive of Unibet, has described the news of a partial privatisation of the Swedish gaming monopoly Svenska Spel as a strategy by the Swedish government to make sure it is not asked to appear in front the European Court of Justice.

Sweden is currently subject to reasoned opinions from the European Commission and Nylander said the pressure from the European authorities was starting to show.

“The legal advice to the Swedish Ministry of Finance is that the country is very close to breaking EU rules on the provision of cross-border services and is getting closer to being asked to appear in front of the European Court of Justice. The first investigation into gambling was cancelled and the latest gaming inquiry is due to submit its findings in mid-December,” Nylander said.

Reports in the Swedish media appeared yesterday suggesting that games that are considered less likely to lead to gambling addiction might be sold off. However, Nylander said the inquiry commission had still not defined what those games were. “They originally included lottery games and are now looking at including sports betting and poker (as being low risk), which Svenska Spel has been very successful at recently. Overall though, they have not truly defined what they consider to be harmful or not,” he said.

Nylander added that market forces were dictating the pace of change in the European online gaming space, which when added to the regulatory pressure brought on by the European Commission, was forcing protectionist countries such as Sweden to adopt a range of measures that were ill-conceived.

The Swedish Minister for Finance Anders Borg recently commented that the question to consider was whether Svenska Spel should continue to operate less harmful games or if other operators should be allowed to offer them to players.

The news follows a report published in early May by the Swedish Moderate Party’s Culture Committee that said the Svenska Spel monopoly should be abolished. A licensing system for online operators would raise enough revenue to make up for any loss of income brought on by the end of the monopoly, the report said.