There’s set to be a new chapter in the longstanding legal battle between the Swedish gambling regulator Spelinspektionen and the operator Svenska Spel Sport & Casino AB.
The regulator has appealed a court decision that saw the operator successfully challenge a SEK 100m penalty fee (approximately £7.7m) for duty of care failures.
Spelinspektionen is appealing the decision of the Administrative Court in Linköping to the Court of Appeal in Jönköping as it believes it conflicts with previous court decisions, as well as the authority’s scope of the duty of care assessment.
Administrative Court sides with Svenska Spel
Back in March last year, Svenska Spel was issued a warning and a penalty fee by the Swedish authority following an audit of the operator in 2021, in which the authority stated that the operator had not fulfilled its obligations under Chapter 14, Section 1 of the Gambling Act, specifically the duty of care supervision.
Spelinspektionen said Svenska Spel didn’t work actively or proactively enough to protect ten customers who showed signs of potential gambling harm between 17 October and 17 December 2021, issuing a warning and a penalty fee of SEK 100m as a result.
Appealing to the administrative court, Svenska Spel said it did meet the requirements of Chapter 14, Section 1 of the Gambling Act, continuously monitors its customers’ gambling behaviour and takes action to help players reduce their gambling when necessary.
The operator added that as the constitution doesn’t state which measures should be taken and when, its own measures should therefore “be considered sufficient when examining whether there were grounds for intervention”.
Siding with the operator, the Administrative Court disagreed with Spelinspektionen‘s assessment based on the “legality principle”, which states that an authority may only take measures that are supported by the legal order and that it must be “sufficiently clear” what individuals must do to avoid a penalty.
Assessed in a ‘completely different way’
The Administrative Court’s judgment can be appealed by Spelinspektionen to the Court of Appeal, which is what the regulator has decided to do, arguing that the Administrative Court’s decision conflicts with previous court decisions and the authority’s scope of the duty of care assessment.
In a statement, the authority said: “The Administrative Court’s judgment incorrectly assumes that the duty of care under Chapter 14, Section 1 of the Gambling Act does not contain any concrete directives for action. The Swedish Gambling Authority considers that the provision places clear requirements on a licensee.
“A licensee must promptly take active measures to protect players against excessive gambling. A licensee must also continuously monitor extensive gambling and, if necessary, take measures at the same pace as the gambling occurs. A licensee must also voluntarily limit gambling to counteract the damage that excessive gambling can cause.
“The customers examined, one of whom was a young person, have gambled extensively and lost significant amounts over a short period of time. Over two months, the losses have amounted to between SEK 260,000 and SEK 600,000. In some cases, the losses correspond to a large part of the customer’s taxable annual income.
“The company’s measures have mainly consisted of warnings and informative messages. The Swedish Gambling Authority assesses that Svenska Spel Sport & Casino has neither continuously followed up on the customers examined nor taken necessary and individualised measures to limit their gambling.
“The Swedish Gambling Authority believes that the Administrative Court has assessed Svenska Spel Sport & Casino in a completely different way than other sanctioned licensees. The Swedish Gambling Authority is therefore appealing the Administrative Court’s ruling to the Court of Appeal.”
‘Greater clarity’
The interpretation of the duty of care under Chapter 14, Section 1 of the Gambling Act has already been raised by Svenska Spel, who called for clarification regarding its interpretation when they reacted to the Administrative Court’s decision earlier this month.
“It is gratifying that the Administrative Court upholds our appeal and overturns the decision of the Swedish Gambling Authority,” commented Fredrik Wastenson, CEO and Business Area Manager at Svenska Spel Sport & Casino AB.
“We appealed because we believe that the penalty fee is disproportionate in relation to the shortcomings and because there is a need to create greater clarity in the interpretation of the duty of care. We believe that the authority may only take measures that are supported by the legal order, the so-called principle of legality, which the court has also stated.”
Compliance
Spelinspektionen has also recently undertaken a review of three operators – AB Trotting and Galloping, Svenska Spel and Lotto Direct Limited – who will be checked for compliance with the provision on the notification obligation according to Chapter 11, section three of the country’s Gambling Act.
Chapter 11, section three of the Gambling Act requires licence holders to notify the gambling authority if they become aware of changes concerning their application or registration of a gambling agent.
The gambling authority stated that once the review has been completed, the results will be published with a link to a decision if intervention is necessary.