Swedish regulator voices support for gambling sanction reform

The Swedish Gambling Authority (SGA) has supported a government initiative to “modernise” the way in which regulatory penalties are dished out to the country’s licensed gambling operators.

Writing in response to the Swedish government’s consultation on a modernised consumer protection regime across several business sectors, the SGA sided with government plans to reform the so-called “market disruption” fee.

Specifically, the SGA agreed the scope of the fees should be widened to include more violations. At present, the Swedish Marketing Act (MFL) includes a requirement for financial penalties to be levied when businesses engage in so-called aggressive marketing.

Section 7 of the MFL states: “Marketing is to be regarded as aggressive if it involves harassment, coercion, physical violence, threats or other aggressive ways of bringing pressure to bear.

“Aggressive marketing is to be regarded as unfair if it appreciably affects or probably affects the recipient’s ability to make a well-founded transaction decision,” the MFL adds.

However, the Swedish government has said the fines requirement should be extended to cover violations contained within Sections 5 and 6 of the act, which also include infractions for so-called “good” marketing practices.

“The SGA is positive to the inquiry’s proposal that the opportunity to decide on [a] market disruption fee according to Section 29 of the Marketing Act (MFL) shall be extended to also include violations of Sections 5 and 6 of the MFL,” the SGA said.

The SGA did however voice its concern over a potential lack of clarity when combining sanction decisions with financial penalties.

In addition, the regulator outlined its support for the removal of the upper limit to the potential market disruption fee. The MFL caps this charge at no more than SEK5m, or 10% of an operator’s annual turnover.

This change would address differences between the market disruption fees charged by the SGA and the Swedish Consumer Agency, according to the regulator.

“An increased possibility to decide on a market disruption fee in the event of infringements of the gaming law’s marketing provisions together with the proposal to remove the upper fixed amount limit leads to a reduced discrepancy between the supervisory authorities’ sanction possibilities, which is positive,” the SGA explained.

The SGA also voiced its support for a requirement to explicitly state which circumstances are to be considered when issuing fines, suggesting this would ensure greater transparency and predictability for operators.

“It should be clarified that the actor’s financial position must also be taken into account when determining the fee, in order to ensure that the fees can be a deterrent even for actors with significant financial resources and to ensure proportionality,” the SGA added.

The Swedish government is currently consulting on whether to introduce a ‘special moderation’ requirement for the marketing of online gambling to bring the practice in line with tobacco and alcohol advertising.