Sweden is a highly developed country and a nation that enjoys a high standard of living and low income inequality. Having a competitive, liberalized open market economy, it had a surprisingly conservative stance on gambling and online casinos, in particular, for decades. The state monopoly on games of chance was finally eliminated in 2019, a year, which saw a groundbreaking reform in the sector and the issuing of 70 licenses for online betting and casino games.
This new, more liberal legal environment received a warm welcome by foreign gambling operators who anticipated lucrative opportunities for their businesses. The latest statistics show that their projections were not far from the truth – 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 contributed SEK14.0 billion. Meanwhile, the unregulated offshore operators saw a revenue between SEK1.8bn and SEK2.2bn, Spelinspektionen says, citing UK-based industry analysts H2 Gambling Capital.
In 2018, the Swedish gambling market had a total gross revenue of SEK 23.4 billion. However, it is hard to compare the data and determine how sales have changed, the regulator explains, adding that the gaming market has probably increased significantly in 2019 following the gambling reform in the country. As of March 2020, 96 firms had active licenses to operate in the Swedish market. Of them, 70 companies were licensed for betting and commercial casino games online.
Legal Landscape
The Kingdom of Sweden has a long tradition of gambling that goes back to the Middle Ages when the Vikings apparently loved all sorts of games, including dice and board games. Most forms of organized gambling were banned in the following centuries and it was not until the 1930s when the Nordic state finally legalized gambling. Initially, only sports betting and lotteries were allowed but soon, the first casinos also opened to the public.
However, until 2019, practically all forms of gambling were carried out by the state monopoly, Svenska Spel. The company was the only one who could operate land-based and online sports betting, casino games, lotteries, bingo products, and poker. Through its subsidiary Cosmopol Casino, the company operates all four casinos in Sweden. The gambling market went through a historic reform in 2019 when the Swedish Gambling Act came into force and allowed private firms to offer gambling services to Swedes.
Svenska Spel
Casino CosmopolThe Swedish Gambling Act 2018
The Gambling Act, which was issued in June 2018, is a complete overhaul of the 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 wagering on sports. The reform allowed the Swedish Gambling Authority to approve private operators and as of May 2020, the regulator 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. Their platforms do not need to be available in the Swedish language, however. The Gambling Act also introduces responsible gambling provisions, according to which license holders are required to offer their patrons self-exclusion options.
The Swedish Gambling Authority
Gambling is regulated on a national level and local authorities have no legislative, executive, or otherwise power when it comes to land-based or online operations. The main regulatory authority is the Spelinspektionen, commonly known as the Swedish Gambling Authority in English, and it is responsible for ensuring that the gambling market is legal, safe and that it complies with the Swedish Gambling Act and other relevant laws. The authority supervises and controls the operation of all betting, gambling, and lotteries activities in the country.
The Swedish Gambling Authority also approves the private operators who would be allowed to offer their services to Swedish residents. It issues and revokes licenses and has the power to block access to unlicensed gambling websites. It can also block financial transactions from Swedish residents to operators who are deemed illegal.
The authority has introduced Spelpaus, a voluntary self-exclusion program for gamblers in Sweden, and users can choose to block themselves from gambling for 1, 3, or 6 months. The other option is to be in the scheme until further notice. The Spelpaus (“a break from gambling”) covers all forms of land-based and online gambling and gambling-related direct marketing.
In addition, the Swedish Gambling Authority works in cooperation 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 determined a tax of 18 percent of the gross gaming revenue (GGR), which applies to all operators licensed to offer commercial gambling services. It is payable once per month and is required for all land-based and online operations, including the state monopolies.
However, those who organize gambling events for non-commercial purposes such as charities and good causes are not required to pay any tax on the proceeds. Another important thing is that players are also taxed – their winnings from gambling are considered income in Sweden and are, therefore, subject to the country’s progressive tax.
Gambling operators also need to pay several other fees and taxes, including ongoing annual fees and one-time application fees that depend on the type of license and the annual GGR. The license application fees are as follows:
- licence for commercial online gambling: SEK400,000;
- licence for betting: SEK400,000;
- joint application for a) and b): SEK700,000;
- renewal of licence under a)-c): SEK300,000;
- amendment of licence under a)-c): SEK150,000;
- licence for state lottery or not-for-profit: SEK5,000-150,000;
- amendment of certain licences under f): SEK40,000;
- licence for bingo (note: not online bingo): SEK30,000;
- amendment of licence under h): SEK5,000;
- licence for local pool betting on horses: SEK3,600;
- licence for land-based slots (per venue): SEK2,800;
- permit for possession of slots: SEK3,600;
- licence for land-based casino games (per venue): SEK3,600;
- licence for land-based casino (per venue): SEK70,000;
- amendment of licence under n) (per venue): SEK15,000;
- card tournaments: SEK4,000-25,000; and
- amendment of key persons: SEK800.