Svenska Spel Chief Wants Lottery Betting Banned

Business News

When the new Gaming Act was announced in Parliament in 2018, an investigation was also set up to monitor the effects. It was a wise decision. 

As the conditions for a market are fundamentally changed, it is necessary, after a while, to verify that it has really given the positive effects that the Riksdag and the government have wanted to achieve.

I think everyone is aware that there are sometimes negative side effects of major re-adjustments. Often it is about rogue players seeing an opening that the legislature had not foreseen. This does not mean that the re-regulation in itself is bad, only that it is extremely difficult to predict in advance all conceivable loopholes, edge balls and debris.

One species that I hope the investigation is looking at is the phenomenon of “shadow play”. This means that a betting company offers betting – but on other betting companies’ products! It can be games like American Powerball, German Keno or Finnish Lotto.

It is incomprehensible that this may continue. I can’t think of any other industry where it’s okay to use competing companies’ products as drawbacks for their own business. The shadow gaming companies cannibalize on well-known lotteries without owning the brands themselves that they market and sell.

“Deposit 25 SEK and get 100 SEK to bet on Lotto” advertises, for example, one of the shadow gaming companies. Only further into the site does it become – hopefully – clear to the player that it is not about Svenska Spel’s Lotto or that you participate in a regular Lotto draw but in “betting on outcome”. The shadow game companies simply go low on incorporated brands.

At the same time, it is very doubtful if customers understand what kind of game they are participating in. You should almost be a game technology expert to understand what “betting on outcome in lotteries” means.

The Swedish Gaming Act clearly states that the lottery market should be reserved for public benefit and the state. In practice, the shadow gaming companies put this out of play. They are licensed for betting, but use this to cash in on lottery revenue. That was hardly the purpose of the new gaming team. This loophole competition removes important lottery revenue from public utility – and it is a development that can accelerate quickly.

In Denmark, which introduced a licensing system for gaming as early as 2012, the risk was seen early. Danish wagering licenses therefore do not allow betting on lotteries. Of course, this should also be the case in Sweden. Said Patrik Hofbaue, CEO, Svenska Spel.