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A report by Sweden’s National Audit Office (NAO) has savaged the Swedish Gambling Authority (SGA), saying it does a poor job of controlling the black market and is arbitrary in the way it handles its licensees.

The SGA is not meeting the standards envisaged by the country’s re-regulation of gambling in 2019, the audit office has concluded, as part of a of the regulator’s performance.

The regulator carries out very few inspections and does not follow up consistently to determine if “alleged deficiencies” in licensees are corrected.

Its choice of who to investigate “is not made on the basis of well-founded risk analyses”, the NAO said.

Not only has the overall number of inspections been too low, but the gambling verticals still under the monopoly control of state-owned Svenska Spel have not been sufficiently examined, the auditor said.

“In order for the system to be perceived as credible … it is important that all licence types and game forms are inspected with some regularity,” the NAO said.

The audit office acknowledged that the SGA’s ability to combat the black market is limited and that the gambling regulator’s requests for additional powers have been largely ignored by the government.

Camilla Rosenberg, the head of the SGA, who has been in her post since the Swedish market was opened in 2019, acknowledged the conclusions of the report.

“We welcome the National Audit Office's review and since the reregulation have carried out ongoing change work and still have work to do. We can look back on six very intense years with a new framework legislation, new actors and new tasks in a completely new regulation.

“Several issues are still awaiting practice in court. The authority has also received increased budget funds for 2024 that we requested, which is a decisive factor in being able to develop the business further,” she said.

The regulator said it continues to streamline its processes and had made organisational changes to strengthen its oversight.

A representative of private gambling companies in the Swedish market sidestepped the opportunity to criticise the SGA and chose to zero in on a recommendation in the NAO report that laws relating to the black market should be changed.

Currently, offshore companies can accept Swedish players without breaking the law, so long as they do not offer Swedish-language customer services, allow gambling in krone or make other obvious attempts to target Sweden.

"That today's gambling legislation allows such extensive parts of the gambling market to operate without a licence is unsustainable. In front of both the current and previous governments, we have advocated an expansion of the Gambling Act's scope of application,” said Gustaff Hofstedt, secretary general of trade group BOS.

“In this way, it would become generally illegal for gambling companies that lack a Swedish gambling licence to accept Swedish gambling consumers, and as a consequence these companies must geoblock Sweden. It is very welcome that the National Audit Office reasons in a similar way in the report published today.”