European Gaming and Betting Association Secretary-General Martin Haijer believes Iceland could follow Nordic neighbors Denmark and Sweden in adopting a successful open licensing regime.
Haijer, in an article published by the Icelandic website Visir on its news page, called for a “rethinking” of Iceland’s market monopoly.
Six entities have received gambling licenses in Iceland, and they must use their profits to support social causes. This means that the private sector is pushed out. A report earlier this year by the Iceland Review magazine claimed that Icelanders spend about ISK20bn (PS112m/EUR134m/$146m) on unregulated foreign gambling websites annually.
Icelanders and other Europeans are “in disagreement” with the system, he warned.
He said that monopolies are designed to restrict consumer choices. Online gambling is driven by price. The people who play online for real money want to maximize their returns.
The attempt to restrict consumer choice by monopolies creates more problems than it solves.
Nordic Liberalisation
Haijer said that the experience of Denmark and Sweden – which introduced regulated gambling markets in 2012 as well as 2019 – was an inspiration to Iceland.
He said that over the last 15 years, Denmark and Sweden have gradually developed a consumer-friendly regulatory framework. The experience of both countries has shown that the introduction of a licensing scheme and ending monopolies had a positive impact on the market. It did not increase unhealthy online gambling.
Iceland is capable of achieving comparable results with Sweden and Denmark but will need political courage and the willingness to change directions.
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Spillemyndigheden (the Danish regulator) claims that gambling rates have increased by 7 % in the 10 year period following the opening of the Danish market. The average monthly gambling spending was about the same, but channelisation rates reached an amazing 90%.
There are still challenges in Sweden where the channelisation rate is lower, and visitors to non-licensed operators have increased by tenfold.
The Finnish government revealed its plans in a July draft proposal to expand the online gambling industry.
Haijer stated that any license regime in Inceland will improve the safety of customers and not encourage them to gamble.
He said: “A change of this kind would create a more regulated and safer environment for the players in Iceland than it is now.”
The experience of other European countries has shown that the implementation of a license system does not come without challenges. This will take careful consideration of the economic, legal and consumer benefits that come with implementing a system. “These challenges are unavoidable, but nearly all European countries were able to overcome them.”
