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Gaming Regulations in Norway

posted 3 years ago

The basis for gaming regulations in Norway is as follows: 

  1. It is fully permitted to gamble in Norway. Gambling debt is however not enforceable.
  2. It is fully permitted to develop gambling services and gambling technology in Norway.
  3. It is fully permitted to provide and market gaming services, not involving stake, chance and a price – e.g. different commercial lotteries.

Gaming services that are embracing each of stake, chance and price are defined as “lotteries”, which are strictly regulated by the Lottery Act in a monopolistic license regime. There has however been granted private bingo- and lottery licenses for beneficiary purposes.

Lottery operations and marketing for such activities are only permitted for governmentally appointed providers. This goes for land based, as well as online, services. The regulations are not extraterritorial, hence only applicable for activity in Norway.

The government has  over the recent years had different attempts to block off shore gaming operators to provide and market their services to Norwegian gamblers, e.g. by negotiating the sender state right directive 89/552/EEC (pursuit of television broadcasting activities) with the EU – and by implementing a transfer ban for gambling transactions. 

A recent amendment to Norwegian gaming regulations, in effect from 1st of January 2020, has increased the Norwegian Gaming Authority’s ability to cancel gambling transactions.  However, new methods of transferring funds, such as increased used of e-wallets and  cryptocurrency, enable that Norwegian customers in large are still able to use off shore gambling services provided by online gaming operators. 

Furthermore, there could be raised questions about to which extent the Norwegian Gaming  Authorities have  the necessary provisions and jurisdiction to ban transactions to / from e-wallets.  That being said, they have already showed that they are willing to do so, and has successfully  forced several e-wallet services to cancel payment processing to online gaming operators in the  Norwegian market. 

We anticipate this “cat & mouse” approach to continue, whereby offshore online gaming operators and payment service providers (PSPs) will continue to find ways to get around the Norwegian ban on payment processing services to gaming operators, as enforced by the Norwegian Gaming  Authority. New technology seems to enable customers to use an increasing number of payment  processing solutions. There are further ongoing discussions on whether or not the gaming  monopoly by the government should be abolished and to implement a license model as we see in some countries. 

Politically, the Right Wing Party, the Liberals and the Conservative Party has been open to liberalize market. However this is not a big debate in Norway as long as the gamblers have access to their off shore services and the government can give the perception that they have gambling activities under control.

Legally, the discussion has been around which games are based on chance and which are not (e.g. not embraced by the ban). Norwegian High Court some years ago stated that “Texas Hold’em” poker tournament with no limit should be  considered as a game of skills, and bridge is exempted from the ban pursuant to a certain provision. Fantasy games are usually exempted as the do not contain a monetary “prize”.

As the gambling market in Norway is, almost, exclusive to monopolists (Rikstoto and Norsk Tipping) it is fair to say that the Norwegian online gambling market is unregulated. Commercial  online gambling providers that want to approach the Norwegian market will have to do this from  outside Norway, with offshore servers, offshore staff and offshore marketing (e.g. with reference  to EU broadcast directive 89/552 EEC) accordingly.  

The legal situation towards offshore online operators is unclear. Norway is obliged, as a  European  Free Trade Association (EFTA) Member State and party to the European Economic Area (EEA)  Agreement, to comply with the provisions of the EEA Agreement. The Norwegian gambling  monopoly is accepted by ESA in Case E-3/06 “Ladbrokes” from 2007, however the EFTA court  didn’t make any decision of the extra-territorial effect.  In Norwegian white paper (Ot.prp. nr. 44  (2002-2003)) the Government discussed jurisdictional issues pursuant to Norwegian gambling  law. The committee stated that the prosecution of a gambling provider offering unlicensed  gambling from another country to Norway would be difficult, unless the offered game is illegal in  the country from which it was provided. Norwegian Gaming Authority has to our knowledge not  pursued offshore gambling providers operating and marketing abroad only.  

The situation for foreign PSPs are based on the same set of rules, and is similarly unclear. 

The “cat and mouse” game in Norway hence seem to be continued…

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