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Emily D. Swoboda

Operators, Academics Skeptical of Swedish Report

18 December 2008

Eighteen months after Sweden was instructed to amend its policies on gambling, the country responded with a 652-page report proposing no significant change to the current regulatory regime. Some commercial operators and suppliers agree, moreover, the report comprises little more than an effort to prolong the monopoly's tenure.

In April 2006, the European Commission initiated infringement proceedings against the Swedish government to determine whether the country's sports betting laws were in compliance with Article 49 of the European Community Treaty, which guarantees the free movement of services across borders.

In June 2007, the commission issued its reasoned opinion -- the final stage in an infringement proceeding before the dispute is referred to the European Court of Justice in Luxembourg. It was then that Sweden agreed to take up an inquiry into sustainable long-term gambling regulations.

Released on Monday, the report -- commissioned by the Swedish government and carried out by Jan Nyrén, a lawyer for the police authority -- recommended two routes for the future of gambling in Sweden.

The first one retains -- tightens even -- the current regulation, meaning Svenska Spel, Sweden's casino, betting and poker monopoly, would maintain its position. The second route would allow the offer of sports betting licenses to foreign operators with certain exceptions.

While on the surface the report complies with the commission's previous requests, a number of European commercial firms seem to agree that the recommendations were conceived to buy additional time during which to preserve the status quo.

"It's just a way for the Swedish government to buy some time and continue doing what they are doing," Johan Öhman, chief executive of NetEntertainment A.B., told IGamingNews. "The only thing you can really do is laugh -- it's a joke."

Mr. Öhman feels that either the Swedish government will eventually be forced by the commission to change its laws or the commercial operators will find a way to circumvent the Swedish government.

Sigrid Ligné, secretary general of the European Gaming & Betting Association, told IGamingNews that the first reaction from the operators her organization represents was disappointment because expectations -- like the partial disbanding of the monopoly -- were not met.

"We feel these proposals do not meet anybody's expectations -- certainly not the industry's," Ms. Ligné said.

"It seems not to answer the problem addressed by the European Commission in its procedure against Sweden," she continued. "Maybe more surprisingly, if we read comments made by the minister of finance in Sweden (Anders Borg), it doesn't seem to meet his expectations either, which is a bit more surprising considering he's been commissioning this report and defining the scope and the remit of the report."

Ms. Ligné said the collective feeling among operators is that they've lost 18 months -- which is unacceptable, she said, considering their rights, as established by European Community law, are continually ignored by Sweden.

"It has been one-and-a-half years since the commission formally asked Sweden to put an end to its monopoly, which the commission finds incompatible with EU law, and we operators have had our rights disrespected for years now," Ms. Ligné said.

Pontus Lindwall, chief executive of Betsson A.B., said this report represents a step back for gaming in Sweden.

However, Mr. Lindwall, at least, was not terribly concerned because he does not believe the recommendations will result, ultimately, in any legislative reform.

Mr. Lindwall's point of view was echoed by Ulf Bernitz, a law professor at Stockholm University who, in a press conference on Wednesday, said the European Commission is not likely to accept the Swedish government's recommendations.

Mr. Bernitz said that neither of the proposals offered in the recommendation comply with European Community law, and he further believes that the commission will challenge the portion of the report that proposes a differentiation between horserace betting and other types of gambling.

Mr. Lindwall's Betsson, along with Expekt, Ladbrokes and Unibet, on Wednesday released the results of a study commissioned last year to assess the monopoly's fiscal efficiency and the possible effects of replacing it with a licensing system.

Mr. Lindwall said the study showed that the possibility exists to finance responsible gaming and civil programs without the monopoly.

Operators, Academics Skeptical of Swedish Report is republished from
Emily D. Swoboda
Emily D. Swoboda