Sweden's gambling regulator Spelinspektionen has banned three operators from targeting players in the country as they did not hold the appropriate licence.
Newera Frozen PTE Limited and Aprodi Limited were banned on similar contraventions. Spelinspektionen discovered that both operators organised illegal “skin” lotteries for Swedish players.
These lotteries allow players to stake skins, which are collectable items that can be sold and purchased within video games. Skins also hold monetary value outside of the video games they belong to.
The regulator found that Newera Frozen PTE operated the site Hellcase.com, while Aprodi operated Key-drop.com. Both sites offered different game modes for betting with skins. One of these was a game where players could place a bet with one skin to win a more valuable skin.
The sites were mainly marketed on video platforms such as YouTube and Twitch. Spelinspektionen noted that the marketing took the form of user-generated material. This meant that the operators commissioned it, but did not have control over the marketing’s contents.
Specifically targeted to Swedish players
In its decision notice, the regulator outlined how it classifies content as being targeted to Swedish players. It considers whether information on the site is in Swedish, if it has a .se domain, whether it uses a Swedish e-identification or payment service and if its affiliates have marketing material in Swedish.
In the case of Hellcase.com and Key-drop.com, the regulator found that both sites contained information in Swedish. The FAQ section on Hellcase.com was in Swedish, and the site also used a Swedish payment company.
Meanwhile, Key-drop.com’s terms and conditions were in Swedish, as was its affiliate marketing.
In response to the investigation, Newera Frozen PTE said it sells loot boxes, “which cannot be considered gambling”, meaning that it did not need an operating licence. The operator has since removed all Swedish text from its site and removed the Trustly payment service it had offered.
Ruling on both operators, Spelinspektionen said that Sweden’s Gambling Act applies to games where the win has economic value.
“… the Swedish Gaming Authority believes that the skins sold on the website should be considered to have a value in money,” it wrote. “The Gambling Act is thus applicable to the game in question.”
Galaktika NV also banned
The regulator also slapped unlicensed operator Galaktika NV with a ban for targeting Swedish players through Drip.casino. Galaktika – which operates multiple sites, including Jet.casino, Fresh.casino and Monro.casino – is registered in Curaçao.
The investigation into Drip.casino found that its affiliate marketing was in Swedish. In response to the investigation, Galaktika NV said it did not intentionally target Swedish customers. Instead, it said it outsources marketing to third-party organisations that target the European market.
The regulator ultimately ruled that Galaktika NV had infringed chapter 3, section 3 of the Gambling Act. This states that a licence is required to provide games in Sweden.
“The Swedish Gaming Authority believes that the company should still be considered to target the Swedish market by having affiliates who market their games to Swedish consumers via affiliate websites,” Spelinspektionen ruled. “Against this background, the Swedish Gambling Authority considers that Galaktika NV conducts gambling activities aimed at the Swedish market.
“Because they lack a licence to provide games in Sweden, the Swedish Gaming Authority decides to ban Galaktika NV from providing games in Sweden.”
Slew of fines
These latest rulings come after Spelinspektionen issued two landmark fines in recent weeks. On Monday this week, the regulator announced that it had hit Svenska Spel Sport & Casino, the digital arm of Svenska Spel, with a fine of SEK100m (£7.5m/€8.7m/$9.5m).
Svenska Spel Sport & Casino is alleged to have taken insufficient measures to combat harmful gambling, as well as not adequately performing player safety checks. The investigation into the company took place between October and December 2021.
Also on Monday, Yggdrasil was issued with a penalty fee of SEK300,000 for allegedly supplying software to a company not licensed to operate in Sweden.