Sweden is a highly developed country and a nation that enjoys a high standard of living and low income inequality. Despite having a competitive, liberalized open market economy, it maintained a surprisingly conservative stance on gambling, particularly online casinos, for decades. The state monopoly on games of chance was finally eliminated in 2019, a year that saw a groundbreaking reform in the sector and the issuance of 70 licenses for online betting and casino games.
This new, more liberal legal environment received a warm welcome from foreign gambling operators who anticipated lucrative opportunities for their businesses. The latest statistics show that their projections were accurate: licensed operators in the country generated revenue of SEK24.8 billion (€2.34bn/$2.62bn) in 2019, according to the Swedish Gaming Authority (Spelinspektionen).
The figures, released in early March, are based on data from the Swedish Tax Agency. The main sources of income for licensees were online casino games and gambling on ships, which together contributed SEK14.0 billion. Meanwhile, unregulated offshore operators generated between SEK1.8bn and SEK2.2bn in revenue, according to Spelinspektionen, which cited UK-based industry analysts H2 Gambling Capital.
In 2018, the Swedish gambling market recorded a total gross revenue of SEK 23.4 billion. However, the regulator explains that it is difficult to compare the data and determine how sales have changed. It adds that the gaming market probably grew significantly in 2019 following the gambling reform. As of March 2020, 96 firms held active licenses to operate in the Swedish market. Of these, 70 companies were licensed for online betting and commercial casino games.
Legal Landscape
The Kingdom of Sweden has a long tradition of gambling dating back to the Middle Ages, when the Vikings reportedly enjoyed all kinds of games, including dice and board games. Most forms of organized gambling were banned over the following centuries, and it was not until the 1930s that the Nordic state finally legalized gambling. Initially, only sports betting and lotteries were permitted, but the first casinos soon opened to the public.
However, until 2019, virtually all forms of gambling were run by the state monopoly, Svenska Spel. The company was the only entity that could operate land-based and online sports betting, casino games, lotteries, bingo products, and poker. Through its subsidiary, Casino Cosmopol, the company operates all four casinos in Sweden. The Swedish gambling market underwent a historic reform in 2019, when the Swedish Gambling Act came into force and allowed private firms to offer gambling services to Swedish players.
Svenska Spel
Casino CosmopolThe Swedish Gambling Act 2018
The Gambling Act, issued in June 2018, completely overhauled gambling and betting legislation in Sweden. The new law entered into force on January 1, 2019, and liberalized the market, opening it to foreign and private companies for the first time. It ended the state-run monopoly on certain forms of gambling, most notably online casino gaming and online sports wagering. The reform allowed the Swedish Gambling Authority to approve private operators, and as of May 2020 the regulator had issued licenses to around 100 companies.
The law also puts various restrictions on gambling products and on certain activities that can be offered online. For instance, operators licensed in Sweden are required to show the currency of each bet made on their platforms in Swedish krona (SEK). Withdrawals of winnings must be made via the same payment processor used by the player when making a deposit.
Licensees are also required to provide all important information, i.e., the rules and the likelihood of winning or RTP, about the games they offer in Swedish. However, their platforms do not have to be available in the Swedish language. The Gambling Act also introduces responsible gambling provisions that require license holders to offer their patrons self-exclusion options.
The Swedish Gambling Authority
Gambling is regulated at the national level, and local authorities have no legislative, executive, or other power over land-based or online operations. The main regulatory authority is the Spelinspektionen, commonly known in English as the Swedish Gambling Authority. It is responsible for ensuring that the gambling market is legal and safe and that it complies with the Swedish Gambling Act and other relevant laws. The authority supervises and controls all betting, gambling, and lottery activities in the country.
The Swedish Gambling Authority also approves the private operators that are allowed to offer their services to Swedish residents. It issues and revokes licenses and has the power to block access to unlicensed gambling websites. The authority can also block financial transactions made by Swedish residents to operators deemed illegal.
The authority has introduced Spelpaus, a voluntary self-exclusion program for gamblers in Sweden. Users can choose to block themselves from gambling for 1, 3, or 6 months, or they can remain in the program until further notice. Spelpaus (“a break from gambling”) covers all forms of land-based and online gambling, as well as gambling-related direct marketing.
In addition, the Swedish Gambling Authority cooperates with other institutions and authorities in Sweden, including the Finance Police and the Tax Agency, which is responsible for ensuring that taxes are properly declared and paid. The regulatory authority for marketing and advertising in the gambling sector, on the other hand, is the Consumer Agency.
Gambling Licenses and Taxes in Sweden
Taxes and License Fees
Types of Licenses
Restrictions
Sweden has set a tax rate of 18 percent on gross gaming revenue (GGR) that applies to all operators licensed to offer commercial gambling services. The tax is payable monthly and covers all land-based and online operations, including the state monopolies.
Operators that organize gambling events for non-commercial purposes, such as charities and other good causes, are exempt from this tax. Players are also taxed because their winnings from gambling are regarded as income in Sweden and are therefore subject to the country’s progressive income tax.
Gambling companies must also pay several other fees and taxes, including ongoing annual fees and one-time application fees that vary according to the type of license and annual GGR. The license application fees are as follows:
- License for commercial online gambling: SEK400,000;
- License for betting: SEK400,000;
- Joint application for a) and b): SEK700,000;
- Renewal of a license under a)–c): SEK300,000;
- Amendment of a license under a)–c): SEK150,000;
- License for a state lottery or not-for-profit operation: SEK5,000–150,000;
- Amendment of certain licenses under f): SEK40,000;
- License for bingo (note: not online bingo): SEK30,000;
- Amendment of a license under h): SEK5,000;
- License for local pool betting on horses: SEK3,600;
- License for land-based slots (per venue): SEK2,800;
- Permit for possession of slots: SEK3,600;
- License for land-based casino games (per venue): SEK3,600;
- License for a land-based casino (per venue): SEK70,000;
- Amendment of a license under n) (per venue): SEK15,000;
- Card tournaments: SEK4,000–25,000; and
- Amendment of key persons: SEK800.