While Sweden is considered a prime example of how online gambling regulation should be managed in the broader industry, this position is being challenged by local parliamentarians. According to recent reports, the Swedish Gambling Authority will face an audit into its effectiveness as the country's land-based and online gambling regulatory body.

The Spelinspektionen website says the following:

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“The Swedish Gaming Authority's supervision is crucial for the goal to be achieved. At the same time, the authority's conditions for carrying out supervision have changed due to the re-regulation of the gaming market. The National Audit Office intends to review whether the Gambling Authority's supervision of the gambling market is effective.”

While the statement doesn't reveal much about the intent of the review, there is a link to the National Audit Office website, which offers more information on the topic.

Has Spelinspektionen Missed the Mark?

In addition to listing the financial impact of the gambling industry on Sweden's treasure, the National Audit Office does specifically make mention of the goals of the Gambling Act:

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"... a healthy and safe gambling market under public control, which protects the revenue for the public and which provides good conditions for non-profit activities to obtain funding through revenue from gambling. The negative consequences of gambling must be reduced and there must be a high level of security in the games. Gambling for money must be covered by strong consumer protection and cannot be misused for criminal activity".

The implication is that the audit aims to determine if the Gambling Authority has been negligent in its duties to the country and the Swedish gambling community.

In particular, a known concern is the increase in unregulated online gambling. Recent reports show that there has been an exponential increase in unregulated gambling in Sweden, with market channelisation that peaked in the mid-80% dropping as low as 59%.

 Too Much Growth, Too Soon?

In its initial overview of the Swedish gambling market, the National Audit Office hints at one of the problems that the Gambling Authority faces: the market's exponential growth rate.

When the market reregulated in 2019, its regulator was predominantly focused on managing Svenska Spel, ATG and the four large national lotteries, as they account for over 95% of the country's gambling revenues. By 2023, this number has exploded to more than 600 licensed online casinos and betting sites, which are not centralised in Sweden but spread across the globe.

Commenting on this point, the Auditor said:

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“The fact that the legislation is largely new also means that there is a lack of practice.”

This sounds like a very polite way of saying that it is possible that Spelinspektionen does not have the proper systems and personnel in place to manage a gambling market as robust as Sweden effectively.

What the final outcome of the audit will be is anyone's guess, but with a due date of September 2024, the staff and management of the Gambling Authority are in for a challenging ten months.