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After imposing new restrictions in July, Swedish online casinos faced a rapid decline in sales. Revenue of privately-owned online gambling companies in Sweden reduced in so great numbers that the already applied changes in the law are considered as challenging factors to the whole business sector of the country. According to the recent data, the monthly revenues also decreased compared with the same periods a year earlier. Specifically, new online casino limits pushed the sales down by 30%, which means that the overall revenue falls nearly one-third from June to August.
Changing the rules has been the result of the coronavirus pandemic. Particularly, the government decided to protect its citizens who had been stuck at homes during the COVID-19 from potential gambling-related harm. However, the actual data shows that there was no need for taking such drastic steps, and the government has been accused of misinterpreting the actual data by John Weinerhall, Swedish member of parliament.
What are the restrictions?
The restrictions were about temporary deposit and spending restrictions on online casino play. The government set the weekly gambling deposit limit of SEK5000 which is about $500 weekly, as well as a bonus no greater than SEk100, which is approximately $10. Other than this, they initiated a loss limit for slot machines and proposed a time limit for online gambling activities.
Changes in the law had been first proposed by Social Security Minister Ardalan Sekarabi on April 23. In June, the Swedish government officially approved these changes and the new rule came into effect on July 2 and will remain through 2020. The online gambling industry body strongly opposed the idea. Indeed, as Nye Casino reported, in the middle of the economic crisis caused by the pandemic, there was no time for implementation of these new rules but the Minister insisted on making the gambling industry in Sweden stricter, as he believes that online gambling is the riskiest form of gambling for Swedish people and decide a temporary shutdown for online casinos.
Did the new law work?
During the lockdown, the everyday routine of the Swedish players changed, because land-based casinos closed down, and taking part in online casinos was the only option for them, but tightening laws wasn’t a solution. As a result, the situation didn’t really change and in fact, it worsened as people started to participate in offshore casinos, as local ones weren’t accessible for them anymore. While playing on offshore casinos and placing bets on unreliable websites the threat is bigger than when you take part in Sweden’s online casinos, regulated by the government. Therefore, new restrictions didn’t really enhance player protection and the results were the opposite.
It wasn’t only the sales market that faced a huge decline. New online casino limits had the worst impact possible on Swedish consumers. During the lockdown then the employment rates had been very high in the country and many people were at risk, it wasn’t time to make such huge changes in the law, as the employment in the country was already at risk.
This is why the government’s actions have been widely considered as irresponsible. The Swedish gambling regulator, the Swedish Trade Association of Online Gambling strongly opposed the decision and published a report showing a general decline in the gambling market, which wasn’t really moving towards the government target of 90%, but instead away from it. They explained the reasons for this huge decline and tried to change the government’s mind, but without success. Again, the Minister cited data showing that irresponsible gambling had been increased in Sweden during the pandemic and named it as the main reason for this kind of changes, but actually, the data was wrong.
A recent study conducted by Lund University about Swedish gambling activity during the coronavirus lockdown, suggests that only 4% of research participants participated in gambling more during the pandemic, while more than 50% reported no change, and 7% even gabled less while staying at home. This means that gambling behavior actually changed during the COVID-19 but it changed for good and there was no need for implementing rapid changes and tightening the law immediately, while the country had much more important problems to deal with.
Was it a political move?
As there are no rational reasons why the government took this risky step without having any real basis, some people started to think that tightening the gambling law was a political move. It’s obvious that the restrictions were nonsensical because they aren’t even aimed at player protection. Because players can open multiple accounts or even start offshore betting, to believe the effectiveness of these limitations is ridiculous. So, maybe it’s just pure politics.
Now gambling operators started to monitor risky behaviors even stricter to prevent customers from losses. In the middle of lockdown, consumer habits did change and these changes may even stay permanently. But one thing is certain, tightening the gambling-related law did nothing good neither to Sweden’s financial market nor to its citizens.
