When the new Gaming Act was introduced, the government made it clear that the lottery market would be reserved for the state and lotteries for non-profit purposes. The intention was to protect the financing of civil society, which in many cases has lotteries as an important source of income. This protection risks being eroded quickly due to the phenomenon of shadow play: betting on the outcome of another gaming company lottery. A new report estimates that shadow gaming companies have almost 40 percent of the European lottery market online.
Svenska Spel and other lotteries for public benefit have for many years generated a large surplus to Swedish society. The companies that offer "secondary lotteries" so-called shadow games companies do not have a lottery license and do not carry their own draws. Instead, they utilize openings in the Gaming Act and with a Swedish betting license they round the legislature's intentions.
Betting on lottery is to play on the outcome of an official lottery draw. In this way, shadow games companies can offer Swedish consumers games at lotteries such as Powerball and Euromillions - but also in Norwegian or Finnish Lotto.
- The shadow gaming companies take market shares from the very part of the gaming market that the new gaming team would preserve. If development continues, funding for sports associations and charities can be adversely affected. In short, all nonprofit businesses that receive a portion of their revenue from public lotteries are affected, says Patrik Hofbauer, President and CEO Svenska Spel.
In a report from the analysis company H2 Gambling Capital, funded by Svenska Spel, it is estimated that the shadow games already account for almost 40 percent of the European lottery market online. The shadow gaming companies' gross gaming revenues were estimated at EUR 1.25–1.5 billion in 2019. According to the report, revenues increase by between 10 and 20 percent per year, an increase which means less money for society and for lotteries that support non-profit activities.
- If the legislature does not act, it can go quickly. In Denmark, this risk was seen early. It does not allow betting on lotteries for gaming companies seeking a Danish betting license. We should introduce the same ban on betting on lotteries in Sweden. It is both right and reasonable, says Patrik Hofbauer.
At 8.30 am on June 8, Svenska Spel will conduct a live webinar on shadow games. During the webinar, the report from H2 Gambling Capital will be presented. Then follows a panel discussion with Per Lodenius, cultural policy spokesperson for the Center Party, Anna Romboli, business area manager at Svenska Spel Tur, Jan Erlandsson, senior adviser at the Miljonlotteriet and Sofia Modigh, head of development at the IOGT-NTO. Follow the webinar here: youtu.be/I2eQqLjE1FM
https://om.svenskaspel.se/koncernnyheter/skuggspel-hotar-finansieringen-av-allmannyttig-verksamhet/