In a , the Swedish gaming operator ATG has raised concerns about the escalating black market gambling in Sweden since the introduction of the regulated gaming market in January 2019. The report, titled “Gambling Under the Radar – An Examination of the Effectiveness of Swedish Gambling Policy”, highlights a tenfold increase in traffic to unlicensed gambling sites over the past five and a half years.

A controversial channelling rate

“In 2022, ATG decided to take matters into its own hands,” explains Hasse Lord Skarplöth (pictured above), ATG’s CEO. “We could no longer just sit on our hands and watch customers get hurt in the unlicensed market, while those of us who tried to do the right thing were surrounded by stricter Swedish legislation. We therefore developed a web traffic analysis tool that could track Swedish visits to unlicensed gambling sites with high precision. Based on the traffic, we could then make estimates of the turnover on these pages. It turned out to be a rather gloomy read.”

Despite the government’s initial aim for a 90 percent channelling rate to licensed operators, the reality has proven to be significantly different, according to the operator. ATG’s analysis revealed that the share of unlicensed gambling remains alarmingly high, with estimates suggesting that 14 percent to 29 percent of gambling activities occur outside the regulatory framework.

ATG’s CEO noted his surprise at government claims in the recent budget stating that the channelling rate had reached 91 percent, particularly when previous estimates were based on questionable methodologies. In its latest report, Spelinspektionen, the Swedish regulator, estimates the channelisation rate for 2023 to be 86 percent. “There is always a risk of error margin when figures are calculated,” he explained, however, the report’s findings call into question the government’s optimism about the current state of the gambling market.

Proposed measures to fight black market gambling

In response to the alarming increase in unregulated gambling, ATG has proposed a series of measures designed to improve oversight and reduce the attractiveness of unlicensed platforms. Key recommendations from the report include:

– Revamping legal definitions: ATG advocates for a change in the current legislation to define that any online gambling available to players in Sweden should fall under Swedish gambling laws. This change would eliminate the unreasonable burden of proof currently placed on the Swedish Gambling Authority (Spelinspektionen). – Implementing IP and DNS blocking: The report emphasises the need for legislative support to enable the blocking of unlicensed gambling websites. Drawing on successful measures from Denmark and Norway, ATG argues that IP blocking could significantly reduce access to illegal gambling sites. – Improved support for problem gamblers: The report calls for immediate outreach to individuals who register for the national self-exclusion program, Spelpaus. Many individuals who seek help for gambling addiction often continue to gamble on unlicensed sites. Increased resources for support organisations are deemed essential by the operator. – Measures against risky gambling practices: ATG suggests the introduction of mandatory self-assessment tests for new players, akin to alcohol consumption prevention initiatives, to help individuals reflect on their gambling habits. – Tighter regulations on bonuses: The report urges a complete ban on all types of gambling bonuses to eliminate the competitive advantage that allows companies to circumvent responsible gambling practices. Instead, competition should be based on the quality of the gaming experience rather than promotional tactics. – Risk classification of gambling products: The ATG report calls for a classification system for different gambling products based on their associated risks, advocating for stricter marketing regulations and responsible gambling measures for high-risk categories.

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