Published: November 19, 2019

Norway Government Is Clinging To Its Online Gambling Monopoly

It seems The US is not the only country in the world where gambling licensing and regulation is a hot topic. Get on a long flight to Europe, and you will find similar problems in many countries. And while some have introduced national online gambling licenses, others have not. This includes Norway, who runs a tight gambling monopoly, with only two state run companies allowed to offer gambling services to the public.

Norway’s gambling monopoly is seeing a steady increase in competition from online casinos run from overseas. And with more than 50% of players preferring overseas operators, some government officials are now weighing their options, while most are still are clinging to the solutions of old.

The Norwegian government has been fighting overseas online casino operators for years, with a breadth of measures put in place to limit players access to their offerings.

These measures include the ban of transactions between Norwegian bank accounts and overseas casino operators, as well as removing online casino apps from the iOS and Androidapp stores, to name a couple.

But despite these efforts, players seek out foreign online casinos, as well as online poker providers, more often than ever before.

The bans don’t seem to scare Norwegian players too much, as a growing number of players are leaving the state run gambling solutions, in favor of online casinos run from outside the country. In fact, a study from Menon Economics (note: in Norwegian) states that the two state run gambling providers in Norway, Norsk Tipping and Rikstoto, now have a combined market share of less than 50% in the Norwegian online gambling market in 2019.

Finding Balance on the Knife’s Edge of Gambling Licensing

The conundrum of whether to license or not is a valid concern for parties on both sides of the fence. On one hand, operators tend to think licensing is a good idea, as it makes them more accessible to players. On the other hand, the monopoly holders understandably prefer to keep their players locked into their own offerings.

But there is obviously more to the discussion than this. For one, many of the benefits that exist with the Norwegian gambling monopoly today, could likely be achieved with a license. Take the tax benefits as an example. As of today, 50% of players decide to take their money outside the country. That is a lot of taxable income that the state is losing out on.

With a national gambling license in place, the state could keep the player’s money inside the country, and also cash in big on tax from the operators.

For this to work however, the tax level would have to be at a point where it would be attractive for both operators and the licensee. A balance that might need some experimenting to figure out.

Addressing the Issue of Gambling Addiction

Gambling addiction is another factor that needs to be carefully considered before implementing a license. Keeping gambling addiction to a minimum is obviously important, and with many operators in the market there needs to be systems in place to ensure the safety of problem gamblers.

In Sweden, where they already have a gambling license in place, they have this solution: All players have to register at the online casinos using the same identifier technology used for online banking. That way their online gambling presence is connected to their social security number. This allows problem gamblers to ban themselves from all Swedish-licensed online casinos with a single click.

Neighboring Countries Went the Licensing Route

Several European countries have chosen to go the licensing route when it comes to online gambling. These include The UK, as well as Norway’s neighboring countries Denmark and Sweden.

Denmark implemented their license as far back as in 2012, while Sweden joined in 2019.

A Possible Turn of the Tide

As mentioned in the beginning of this article, the general consensus in the Norwegian government is still to keep the gambling monopoly. However, with the ever increasing presence of overseas online casinos, some members of parliament are starting to see licensing as the only viable solution.

Tage Pettersen, a member of parliament from the Norwegian Conservative Party, has this to say about the situation:

“We have to have a discussion about licensing before we are forced to do so… Today we don’t have control over the gambling market. We can’t stop the foreign companies, and we have to remember that Norway is not a deserted island that does not get affected by the outside world.”

What will happen is still on the horizon for Norway, and it likely won’t change in the immediate future. It does, however, seem like more nations across the world are opening their eyes to the opportunity of licensing and regulation. Hopefully that spells good news for the future of online gambling in America too.

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