Kindred Group has lost its appeal case against the Norwegian Gaming Authority (NGA), which has demanded the operator exit the market.
The Borgarting Court of Appeal upheld the NGA’s decision to cease Kindred-subsidiary Trannel International from offering its services in Norway.
“We now expect the company to withdraw completely from the Norwegian market,” said NGA-director Atle Hamar (pictured).
Kindred Group has also been instructed to pay legal costs to the Ministry of Culture and Equality.
This ruling is the latest development in a legal dispute that began in 2019.
The NGA said Trannel, which is licensed by the Malta Gaming Authority, offered its Unibet, Maria Casino, Storspiller and Bingo brands to customers in Norway, where it does not have permission to operate gambling.
In September 2022, the NGA imposed a compulsory daily fine of €116,676 (NOK1.2m) on Trannel until the operator ceased its activities in the country.
The operator disagreed with the fine and argued that that it is not illegal for Norwegians to use cross-border services, including online gambling.
In accordance with EEA law
Norwegian Culture and Equality Minister Anette Trettebergstuen stated that the court found that the Norwegian exclusive rights model is in accordance with EEA law.
She added that the outcome of the case was not surprising, as it aligns with previous rulings that have supported the state in similar gambling-related lawsuits.
Last year, Kindred Group made some changes to its offering “as a sign of good faith” and decided to only “passively accept customers residing in Norway.”
A spokesperson for Kindred Group expressed disappointment with the verdict but emphasised that it does not alter the company’s belief in the need to abolish the gambling monopoly to enhance consumer protection and increase the state’s income for distribution to sports and volunteering.
“It is also worth pointing out that it is perfectly legal for Norwegians to play at foreign gambling companies. We will continue to challenge the monopoly in all arenas, and in all forums, where a fact-based discussion is opened,” the company said.
The Norwegian Gambling Authority (NGA) has paused its €116,676 (NOK1.2m) compulsory daily fine against Kindred Group subsidiary Trannel International once again.
The decision is the latest development in an ongoing legal battle between Kindred and the Norwegian authorities, which began in 2019.
Back then, the NGA banned Trannel from providing its services to Norwegian customers, claiming that the operator’s offering violated the country’s strict monopoly model.
In October, however, the regulator said it it would not enforce the fine it had previously issued if Kindred agreed to meet a number of conditions.
These included removing its Norwegian-targeted iGaming websites and no longer targeting Norwegian customers.
Kindred, meanwhile, said it had stopped targeting Norwegian customers as “a sign of good faith” but would continue to keep its sites live and passively accept Norwegian players.
Kindred: “The Norwegian Government has however confirmed that it is entirely legal for Norwegian customers to use the company’s services.”
In November, the NGA reinstated the fine as it considered the changes made by Kindred to be insufficient.
A Kindred spokesperson told iGaming NEXT that the NGA has now decided to postpone its daily fines on Kindred “as it acknowledges that the company has adapted its operations in Norway according to the demands from the NGA”.
Kindred added that it has stopped its advertising and marketing activities in Norwegian and has changed the language on all sites from Norwegian to English, amongst other measures.
“The Norwegian Government has however confirmed that it is entirely legal for Norwegian customers to use the company’s services,” Kindred said.
According to Norwegian news site Kampanje, the NGA’s decision to pause the fine, effective 10 December, came after the regulator received new information provided by Trannel in a letter, in which the Kindred subsidiary had stated its intent to leave the Norwegian market.
The NGA said the fine has been halted until Trannel’s appeal against it has been decided upon.
The Norwegian Gaming Authority (NGA) has reinstated a €116,676 (NOK1.2m) compulsory daily fine against Kindred Group subsidiary Trannel International despite major changes made by the operator in recent months.
Kindred said it still disagreed with the legal basis for the fine and would continue to challenge it in court. Crucially, the operator said it would continue to passively accept customers residing in Norway.
The ongoing legal dispute is rooted in a 2019 decision by the NGA to ban Trannel International from offering its services to Norwegian customers. The NGA argued Trannel’s offering violated the country’s strict monopoly model.
However, in October, the regulator said it it would not enforce the fine it had previously issued if Kindred agreed to meet a number of conditions. These included removing its Norwegian-targeted iGaming websites and no longer targeting Norwegian customers.
At the time, Kindred said it had pro-actively decided to make changes to its offering “as a sign of good faith” and decided to only “passively accept customers residing in Norway.”
While Kindred had stopped actively targeting Norwegian players, the operator had not taken its websites down.
Kindred today (21 November) said it has implemented several changes during the past month to ensure Trannel does not target Norwegian residents.
These include switching the language on all sites from Norwegian to English, removing any Norwegian flags from websites and channels, changing the name of its website Storspiller to a non-Norwegian name, discontinuing all advertising and marketing activities in Norwegian and ceasing to offer Norwegian speaking customer service agents.
In spite of these changes, Kindred said “the NGA incorrectly claims that Trannel’s offering still targets Norwegian residents” and has therefore decided to reinstate the coercive fine.
Kindred said it firmly disagreed with the NGA’s assessment as it was fully legal for Norwegian residents to access and use international gambling services, which are licensed in the EU/EEA area and offered within a safe and secure environment.
The operator reiterated its previous claim that the NGA does not have jurisdiction over Trannel as the company was domiciled in Malta and duly licensed by the Maltese Gaming Authority (MGA).
“Therefore, Kindred is confident that the coercive fine cannot be enforced by the NGA outside of Norway,” the company said.
Moreover, Kindred highlighted that it had applied for a gambling licence in Norway as the company wished “to be an active part of Norwegian society” and contribute through taxes, as well as investments in sports, NGOs and research institutes.
The legal battle between the Norwegian Gambling Authority (NGA) and Trannel International took another turn today (7 October) as the regulator put the €116,676 (NOK1.2m) compulsory daily fine for the Kindred-owned subsidiary on hold.
The NGA said it would not enforce the penalty it had issued in mid-September if Trannel agrees to meet a number of conditions.
Kindred’s Maltese subsidiary Trannel stands accused of allowing Norwegian customers to gamble on its websites, which according to the Norwegian regulator violates the country’s strict monopoly model.
The dispute dates back to a 2019 NGA decision to ban Trannel International from offering its services to Norwegian consumers. Kindred has repeatedly refused to back down.
However, one reason for the regulator’s decision to suspend the fine was that Trannel had indicated its willingness to comply with Norwegian law, NGA director Henrik Nordal said.
Therefore, the NGA said it would not enforce the fine until the appeal has been decided upon, provided that Trannel now cooperates with the regulator.
The NGA said that Trannel must remove its Norwegian-targeted iGaming websites, such as no.unibet.com and the corresponding sites for Mariacasino, Storspiller and Bingo, and must remove the option to select the Norwegian language on its websites.
In addition, the NGA wants Trannel to cease all Norwegian-language marketing activities as well as any other marketing activities aimed at customers in Norway.
Moreover, the regulator warned Trannel not to target new customers in Norway and ordered the Kindred-owned subsidiary not to provide any form of information to customers on how they can circumvent the Norwegian payment processing ban.
The NGA also expects Trannel to inform its customers that the regulator and the appeal bodies have decided that Trannel’s gambling offer in Norway is illegal.
Nordal said the NGA will check carefully how Trannel complies with these conditions and will enforce the fine in case of non-compliance.
In response, Kindred said it disagrees with the regulator’s statement and maintains its position that it is fully legal for Norwegian residents to access and use gambling services licensed in the EU/EEA area.
Kindred reiterated that it strongly believes that a locally licensed gambling market where responsible operators can operate under the supervision of competent authorities is the best solution for local societies, for players, and for operators.
However, “as a sign of good faith”, Kindred pro-actively decided to make changes to its international offer and only “to passively accept customers residing in Norway,” the operator said.
While Kindred stopped actively targeting Norwegian players, iGaming NEXT understands that the operator does not intend to take its sites down.
Kindred said it is adopting this approach to seek “a constructive and transparent dialogue with Norwegian authorities and Norwegian policy stakeholders”.
In addition, the operator highlighted that it had over the years filed several applications for local licences in Norway and is “ready to work within a Norwegian licensing system compliant with EU/EEA law”.
Kindred Group will continue to fight for its right to provide online gambling in Norway in spite of losing another lawsuit.
The Stockholm-listed operator has confirmed it will appeal the most recent decision of the Oslo District Court.
Yesterday (21 June), the court confirmed the 2019 decision of the Norwegian Gambling Authority (NGA) to ban Kindred operating subsidiary Trannel International from offering its services to Norwegian consumers. Kindred now has one month to appeal the decision.
A Kindred spokesperson told iGamingNEXT: “We take note that the Oslo Town Court has not accepted our arguments that there is a lack of legal basis for the NGA’s cease and desist order. We continue to dispute and will appeal as we seek to deliver a free, open, competitive and safe gambling environment in Norway. ”
Norwegian Gambling Authority director Alte Hamar: “We now expect Trannel (Kindred Group) to withdraw from the Norwegian market.”
The dispute started three years ago when the NGA first ordered Trannel to stop offering services in the country as it does not hold a Norwegian permit.
Malta-licensed Kindred, however, argued that Norwegian customers have the right to access its various websites, including Unibet, MariaCasino, Storspiller and Bingo under EEA-law.
Trannel previously appealed the regulator’s decision to the Norwegian Ministry of Culture and the Lottery Board, although both appeals were denied.
Kindred Group spokesperson: “We continue to dispute and will appeal as we seek to deliver a free, open, competitive and safe gambling environment in Norway.”
Trannel also asked the Oslo District Court to determine if the NGA’s decision was valid. In its judgement, the District Court upheld the previous decisions and described them as a necessary consequence of Norway’s exclusive rights model.
NGA director Alte Hamar commented: “We now expect Trannel to withdraw from the Norwegian market.”
Norway is one of the few countries left in Europe to operate via a state-owned monopoly model under the terms of the Norwegian Gambling Act, through Norsk Tipping and Norsk Rikstoto.
Kindred has long opposed the Norwegian monopoly on gambling.
The Kindred spokesperson told iGaming NEXT: “We continue to believe that a transparent and objective licensing regime is the only way to obtain a well-functioning gambling market that balances consumer entertainment and consumer protection. We will continue to work towards this goal.”
Earlier this year, Kindred pledged to fight for an international licensing system in Norway and announced it will not prevent Norwegian players from accessing its sites.
The gaming authority previously warned Trannel that it would be sanctioned with a coercive fine of NOK 1.2 million (€120,000) per day if it does not cease its so-called unlicensed activities. Kindred has also been ordered to pay the costs of the latest appeal.
Kindred Group has pledged to fight for an international licensing system in Norway and will not prevent Norwegian players from accessing its sites.
Kindred clarified its stance after the Norwegian Lotteries Authority (Lottstift) wrote to its Trannel International subsidiary on 11 February to say it was considering issuing a coercive fine of NOK437m (€43m) – or NOK1.2m a day – against the operator.
Lottstift insists Kindred is acting illegally and offering online gambling in Norway, where only state-owned company Norsk Tipping and private trust Norsk Rikstoto are licensed.
However, Kindred maintains it does not offer online gambling in Norway – it merely does not stop Norwegian citizens from accessing its Malta-licensed international sites on brands including Unibet and Maria Casino.
“In the same way that it is not illegal for Norwegians to shop with eBay or Amazon, it is not illegal for Norwegians to participate in cross-border services, including lawful, regulated entertainment-based gambling,” said Kindred Group in a statement.
The operator also pointed out that Lottstift is not able to impose fines on companies that are not licensed for gambling in Norway, including Kindred Group.
Nevertheless, Lottstift has said it is weighing up an appropriate financial penalty as its prior warnings to Kindred have so far fallen on deaf ears.
“We take it seriously that the illegal gambling offer has not yet ended,” said Norwegian Liberal Party politician and Lottstift director Atle Hamar.
“Therefore, the authority warns that we will now make a decision on a coercive fine, if Trannel does not stop offering illegal gambling in Norway.
“The authority has on several occasions asked Trannel to provide information on how they will comply with the decision, without the company having followed this up,” he added.
There is already bad blood between Kindred Group and Lottstift. The regulator fired its first cease-and-desist warning to Kindred back in April 2019. The operator has since launched a number of failed appeals against that order.
The matter has now been escalated to the Oslo District Court with the case to be heard in May 2022.
Kindred will not only remain open for business to Norwegian consumers in the interim but has vowed to “fight on the frontline for a long-awaited transparent and non-discriminatory Norwegian licensing system”.
Rolf Sims, Kindred public affairs manager for Norway, said: “In failing to organise a transparent licensing regime and conducting a truly consistent gambling policy, we feel that the fundamental freedoms within EEA-law are systematically being violated by Norway, to the Norwegian government’s advantage.
“The lack of a transparent and objective licensing regime and the inconsistencies of the current regime disregard what should be the core policy focus – protecting local consumers,” he added.
Kindred does not market its international online gambling services to Norwegian consumers but its Unibet brand does sponsor five-time World Chess Champion Magnus Carlsen.
Kindred’s share price is up by more than 4% at the time of writing to SEK109 per share on Nasdaq Stockholm.