Norway Blocks Bettson, Kindred Group, Cherry’s Co-Gaming Group

Saturday, March 9th, 2019 | Written by April Bergman
Norway Blocks Bettson, Kindred Group, Cherry’s Co-Gaming Group

The Norwegian Gaming Authority (Lotteri-og Stiftelsestilsynet) has warned six online gambling companies based in Malta to stop accepting play from Norwegian players, which it deems illegal. The Gaming Authority also has ordered domestic banks to block all payments between Norwegian residents and those six online gaming sites.

Currently, Norway allows its residents to play legally at only two sites: Norsk Tipping and Norsk Rikstoto.

Norsk Rikstoto is a state-run operator which handles racebook betting. Norsk Tipping is a state-run company which offers casino gaming and sports betting.

Earlier this month, the Norwegian Gaming Authority sent warning letters to two Malta-based gaming companies: Kindred Group and Lucky Dino Gaming Ltd. This week, the Gaming Authority sent similar letters to Betsson Group, Co-Gaming Ltd. (a subsidiary of Cherry AB), Gaming Innovation Group (GiG), and L&L Europe Players Ltd.

Betsson, Kindred’s Lobbying Group

It is a stark reaction to the news last month that Betsson, GiG, and Kindred Group had formed a partnership to lobby the Norwegian government: the Norwegian Industry Association for Online Gambling (NBO). Fredrik Stenstrom, the former commercial director of Rikstoto, and Rolf Sims, a former member of the Norwegian Ministry of Culture who helped write Norway’s gambling policy, were enlisted to lead NBO.

A similar strategy worked in Sweden, as Betsson, Kindred, and GiG joined Svenska Spel as some of the first 16 online gambling operators to receive licenses from Spelinspektionen (The Swedish Gambling Inspectorate). Of course, Betsson is owned by Cherry, a casino equipment manufacturer and the oldest and best-connected gambling company in Sweden.

Cherry owns Betsson, Net Entertainment, and Co-Gaming Ltd., so its influence cuts across most parts of European gaming: sports betting, online casinos, and land-based slot machine manufacturing. Despite the influence and resources of Cherry and strategic allies like Kindred Group and GiG, Norwegian authorities appear to have no patience for the NBO’s lobbying effort.

Six Maltese Online Casinos Blocked

The Norwegian Gambling Authority alleges that all of six companies have marketed to Norway’s players, while also signing up players against the government’s express wishes. The warning letters are part of a multi-phase effort to stop such practices.

Norway’s lawmakers have tried for years to eliminate illegal online gambling by citizens at offshore websites. Those efforts have been largely a failure to this point, so the Norwegian Gaming Authority is attempting to block IP address for the Malta-based online gambling sites.

Norway banned slot machines in 2007, but approved interactive video terminals (IVTs). The ban on slots came from lax regulations, which allowed an exponential growth of Norwegian slots from 2001 to 2004. Because of the rapid growth of the slots industry and a few high-profile cases of problem gambling, the public mood soured against slot machines. In many ways, Norwegians’ attitudes toward gambling still are colored by the rapid rise of slots in the early years of the 21st century.

IP Blocks Common in European Gaming

It is the latest trend in European gambling regulation, where governmental authorities ask internet service providers (ISPs) to block the domains of banned sites. While ISPs do not like to waste time and resources blocking such sites, regulators in Switzerland, Ukraine, Georgia, Latvia, and Armenia each have taken similar steps.

Nearby Sweden, meanwhile, has taken a different approach. Swedish lawmakers passed sweeping regulations which would end longstanding state-run gaming monopolies and open the door for competition from domestic and international gaming sites. A year-long licensing process is underway.

In the coming years, it will be instructive to see which of the two legal models works best. Since Sweden is opening up its gaming industry at the same time Norway is trying to ban foreign operators from its domestic gaming sector, the results should be more of an apples-to-apples comparison than most gaming cases.