The Norwegian dilemma: state monopoly coexisting with illegal gambling and a low-quality gambling offer full of contradictions

In this "INFOPLAY SPECIAL REPORT" we explore the complex landscape of land-based and online gambling in Norway, where a strict state monopoly coexists with illegal gambling, while facing criticism for the questionable quality of the offer and high taxation.
Even though Norway is a small country with a population of just over 5.5 million people, its dominant position as an exporter of oil and natural gas makes the country one of the most powerful economies in the world and an example of the modern welfare state.

Having a high gross domestic product allows its citizens to enjoy a high quality of life. However, this is not accompanied by a significant percentage of spending on leisure related to gambling. Something that should surprise us given the gambling culture traditionally associated with Scandinavian countries...

That's why we dedicate this SPECIAL INFOPLAY REPORT to highlight the criticisms Norway faces for the questionable quality of its land-based and online gambling offer, high taxation, threats to well-known operators such as Unibet, and the reality of the two operators authorized by the State.

A Cornered Sector

The gambling sector is far from being a fundamental pillar of the Norwegian economy. Although state revenues have been significant, there is not a high demand for jobs, and technological companies have not been promoted despite the importance of startups and emerging companies in the country.

So, unlike what happens in industries like energy or fields such as design, sustainability, or ecotourism, we can say that Norway has regulated and managed gambling in a -at least- questionable way.

The Reality of Gambling in Norway

At the land-based level, any form of live gambling activity and promotion must be authorized by the Norwegian Gambling and Foundation Authority and is only granted to organizations with humanitarian purposes.

There are no land-based casinos, and even gaming locations in resorts or restaurants are not allowed; even the authorization of slot machines is subject to similar conditions in places where there is a social end under the General Lottery Act of 1995.

There was a ban on slots, even online, although since 2009 there have been interactive video slot terminals.

In essence, only licensed bingo halls and betting halls under the name "betting halls" are allowed, although with extremely restrictive distribution and opening permits, and for example, they are always located near racetracks, which also have the possibility to offer on-site horse betting.

Additionally, occasional authorizations are granted for private lotteries, poker tournaments, and bingo activities under certain conditions outside the aforementioned places.

In any case, gambling in Norway has historically been illegal. In fact, since the emergence of online gambling, the country's government quickly authorized only two operators (Norsk Tipping and Norsk Rikstoto) to cover the wide range of regulated gambling demanded by its citizens.

However, gambling in society is not taboo, and its practice is not hidden. Lottery, poker, bingo, and horse racing have been entertainments that have accompanied Norwegians for decades.

Furthermore, in recent years, sports betting has become the fastest-growing leisure activity due to the rise of sports, as shown by the massive audiences for sports broadcasts, mainly football (with the Premier League and matches featuring their compatriot Erling Haaland being the most-watched events), handball, and winter sports.

And Regarding Poker, such is the passion for this game that, despite the crusade against it by the Norwegian Gambling and Foundation Authority, from 2014, a Norwegian Poker Championship with television coverage has been allowed. A year later, low-stakes poker was authorized, provided it is played in private homes with a maximum of 20 players and the total bet per player does not exceed 1000 kroner.

Outdated Legislation

The Legal Framework regarding gambling revolves around the Penal Code of 1902, where two articles require state permits to organize gambling activities and consider all forms of entertainment in which chance plays a significant role as prohibited.

Due to its importance at the time, it was decided to regulate more flexibly (but also under a state monopoly) the bets related to horse racing. For this purpose, the so-called Totalizator Betting Act of 1927 came into force.

Almost a century later, in 1995, the Gambling Act was enacted, confirming state control over all forms of physical games and the emerging online games. It was also used to list and expand lottery products and slot machines in physical establishments and authorized agencies.

Already in these two new laws in 1995, preventing problems associated with gambling and ensuring that gambling is carried out in a controlled and responsible manner were the reasons given to prevent private companies from offering online games to citizens.

Two Public Operators to Protect

From that moment on, Norsk Tipping is the only operator that offers games such as lotteries, sports betting, scratch cards, and Keno, with particular rules on schedules and betting limits. On the other hand, Norsk Rikstoto is the only company authorized to organize bets on horse races.

In both cases, their features, design, format, and game offer are considered to be of much lower quality than what can be enjoyed in neighboring countries like Sweden, which has regulation open to competition from private operators

In 2021, the Minister of Culture, Sport, and Equality, Abid Qayyum Raja, explicitly proposed banning any activity from foreign companies offering online gambling products, singling out Unibet, Betsson, and ComeOn as examples of hostile operators.

The opposition accused the Minister of "censorship, abuse of power, and an attack on internet freedom," although since then there has been a crusade against private companies that, even without a license, operated according to Norwegian law and did not operate in the country.

Under Raja's mandate, a ban on the distribution of television advertisements broadcast from abroad was also enacted in 2021, preventing the viewing of gambling advertisements even during international sporting events.

The Norwegian Gaming Authority (NGA) Continues to press

With the two legislations from the 90s, the only authorized gambling activities could only be practiced in homes, even avoiding their practice in clubs or associations for activities such as chess or board games.

Since then, the government has been working to prevent private companies from operating in Norway and has created specific measures to ensure that even during holiday periods abroad, Norwegian citizens cannot gamble online anywhere.

For example, in 2010, the Norwegian government banned the use of credit and debit cards in online and land-based casinos worldwide.

And a few months later, justified by the success of Norwegian poker players like Annette Obresttad, Norwegian citizens were required to declare earnings from gambling in other countries.

In the context of this wave of attacks, as reported by Hermann Pammingeren (Secretary General of the European Casino Association) in the second week of August 2023, the Norwegian Gaming Authority has issued notices to the Malta Gaming Authority-licensed companies Hillside Sports (bet365) and ComeOn to effectively prevent any activity with Norwegian citizens. This comes as other major companies similarly approached (Kindred Group and Betsson) have appealed these communications. In any case, Kindred must submit plans to implement the court's ruling by September 1 for review.

The current debate is that the NGA is not only trying to prevent activities by limiting the granting of licenses but wants international operators not to use the Norwegian language on their websites, offer sports markets or gaming events like poker, or provide specifically Norwegian services.

The Most Famous Norwegian as Unibet ambassador, and Playing the Norwegian Championship... in Slovakia!

Interestingly, and as a conclusion that justifies having used adjectives like "questionable" or "contradictory" to define gambling regulation in Norway, it should be noted that one of the operators targeted by the Norwegian Regulator is Unibet, the flagship brand of the international Gaming Holding Kindred Group.

For over five years, the person who, alongside Erling Haaland, is the most well-known Norwegian worldwide, in this case, world chess champion Magnus Carlsen, has been an ambassador for Unibet, further associating poker as a game of skill.

And as we see in the image above, the greatest chess player of all time, Magnus Carlsen (wearing Unibet advertising on his jacket), participates in the Norwegian National Championship, in a casino in Bratislava (Slovakia)... ¡not even in Norgaw!.

A striking reality that serves as our farewell, leading to the obvious conclusion: the lack of sense and the questionable consequences that this way of legislating can have.

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