Sweden Considers Redefining Illegal Gambling

Sweden Considers Redefining Illegal Gambling

Sweden's Gambling Act, which has been in place since 2018, may soon assume a broader role following a government review aimed at addressing enforcement difficulties and regulatory gaps. Investigator Marcus Isgren, appointed earlier this year to evaluate the legislation, has presented proposals that would shift the focus of the law and introduce new tools to restrict unlicensed activity.

The review recommends the removal of the so-called directional criterion, a provision that has guided enforcement since the law took effect. Under this standard, Sweden's regulator has been able to act only against online gambling companies that actively target the Swedish market. In practice, platforms that display Swedish language options, accept payments in kronor, or market directly to local players could be pursued. Operators who did not make these direct appeals, yet still accepted Swedish players, often remained beyond the scope of enforcement.

Isgren's proposal suggests abandoning this approach in favor of a participant-based model. Rather than examining whether a company aims its services at Sweden, the decisive factor would be whether people located inside the country can participate. If so, the operator would fall under Swedish regulation unless it can demonstrate effective measures that block participation from Sweden. Tools such as geoblocking become crucial for operators seeking to evade jurisdiction.

This change is intended to close a gap that has long hindered the Swedish Gambling Authority, Spelinspektionen, in curbing unlicensed activity. The adjustment would create a clearer standard: if Swedish residents can play, the operator is accountable under Swedish law. The underlying purpose remains consistent with the original act: to protect consumers, prevent crime, and maintain a safe and transparent market. However, the reach of the law would be far more direct.

The review also recommends tightening restrictions on those who support unlicensed operators. The current ban on promoting illegal gambling would be expanded to cover services such as payment processing and administrative support, even when those services are not explicitly designed for the gambling sector. In practical terms, providing payment channels for unlicensed companies could fall under the prohibition, regardless of the wider nature of the service provider's business.

To strengthen this measure, the report outlines a presumption rule. Under this principle, intermediaries facilitating payments to or from gambling companies that operate illegally would be expected to assume Swedish participation if the individuals are resident in Sweden. Only when it is clearly demonstrated that the individual is playing from abroad would the presumption not apply. This rule is intended to prevent payment services from becoming a loophole for unlicensed platforms to continue operating in Sweden.

In addition to expanding the scope of the law, the review calls for adjustments to criminal liability related to illegal gambling and its promotion. The aim is to provide authorities with more effective means to enforce the legislation and reduce the flow of money between Swedish players and unlicensed operators.

The proposals are scheduled with a forward-looking timeline, as the suggested amendments are set to take effect on January 1, 2027. This lead time would enable regulators, licensed operators, and service providers to adjust their systems and practices to meet the new requirements. It also allows international operators to assess whether they can comply with the rules or whether they must take steps to block Swedish players entirely.

Industry reaction has already begun. Svenska Spel, Sweden's state-controlled gambling company, expressed approval of the recommendations. Anna Johnson, the company's president and CEO, highlighted that the sector has been raising concerns about the limitations of the current law for several years. She noted that stronger measures against unlicensed operators are not only about consumer protection but also about maintaining trust in the Swedish licensing system.

Johnson also suggested that further steps could follow once the proposed changes are in place. Among them, she pointed to DNS blocking of unlicensed gambling sites as a possible future tool that could complement the reforms. Such measures, she argued, would reinforce the integrity of the licensing market and make it harder for illegal operators to reach Swedish consumers.