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Changes set to be introduced to Sweden’s Gambling Act will provide the country’s regulator with enhanced powers for blocking payments to unlicensed operators.

Payment blocking changes

The Swedish Gambling Authority (SGA) previously held powers to order the blocking of online payments to unlicensed operators, but said there were “certain practical difficulties” within the existing regulation which made those powers difficult to enforce.

As a result, the regulator has never been able to use the existing law to order payment providers to block certain payments.

That existing provision will therefore be revoked from Sweden’s Gambling Act, to be replaced with a new stipulation that the SGA can require payment providers to share customer information necessary for the blocking of payments to unlicensed operators.

The regulator will therefore be able to more easily order the blocking of payments, with the aim of increasing the rate of channelisation to Sweden’s regulated gambling market.

The changes will come into force on 1 July 2023 after being decided on by government in the Riksdag.

A report published by Sweden’s State Treasury in 2021 showed that 85% of gambling in the country during 2020 took place with licensed operators, marking a decline from 2019’s reported channelisation rate of 90%.

Industry reaction

Johan Strand, CEO of payment provider Zimpler, reacted positively to the development. 

“If Spelinspektionen gets better tools to act against payment suppliers not following the guidelines, consumer protection will be strengthened and the playfield more even for payment suppliers that follow local laws and regulations,” he told iGaming NEXT.

“Zimpler of course favours the efficient blocking of payments to illegal gambling. It’s in our interest to work for responsible gambling, as it makes our business much less complicated.

“We have also proposed further measures to strengthen responsible gambling, for example IP blocking of Swedish consumers from games licensed outside of Sweden, and the introduction of B2B licenses for payment service providers,” Strand concluded.

Covert supervision of licensees

In addition to its new payment blocking powers, the SGA will also be granted permission to undertake ‘mystery shopper’-style supervision of its licensees.

At present, in the absence of legal support to allow the SGA to undertake “hidden supervision,” the regulator is limited in its ability to oversee the online gambling sector.

The government will therefore approve a new measure allowing the SGA to use gambling services online under a secret identity.

This method of supervision has already been used on several occasions – amid some controversy – by the Netherlands Gambling Authority (KSA).

Combatting match-fixing

Further to those measures, new changes to the law will also allow for improvements in Sweden’s work to combat match-fixing in professional sport.

While the government believes that combatting match-fixing should be undertaken by sports bodies themselves, a new proposal will see gambling licensees able to more easily supply certain customer information to sports federations.

Changes to the Gambling Act will therefore clarify that sports associations – and other organisations working with sporting integrity – are permitted to process and share customer data in order to counteract match-fixing.