Swedish media gorges on illegal gambling ads

Despite the prosecutions against ten media bosses for publishing gambling ads, the Swedish media earned almost 700 million kronor from the illegal promotions last year, according to new statistics.

Earnings were up by almost 250 million kronor compared to 2005.

“It hardly feels worthwhile continuing to report cases when very little happens,” said the chief legal counsel at the Gaming Board, Håkan Hallstedt.

For many years the board has been reporting the editors of several major Swedish media outlets which have published gaming ads from international companies.

In cases which have come to court, the verdict has been in favour of the Gaming Board. But all cases so far have been appealed and the Supreme Court is now considering whether it will hear the cases against the editors-in-chief of Expressen and Aftonbladet.

In a similar case against the editor-in-chief of Nerikes Allehanda the Supreme Court rejected the application for a second appeal and the Appeal Court’s guilty verdict stood. So far the punishment has been fines and suspended sentences.

But the economics makes sense for Swedish media bosses prepared to risk acquiring a criminal record. In 2005 foreign gambling companies spent 450 million kronor advertising in Sweden. In 2006 that figure soared to 700 million kronor.

At the same time Svenska Spel, Sweden’s state-run gambing monopoly, has seen its own marketing budget fall. In 2004 the organisation spent over 350 million kronor on advertising but that dropped to 277 million kronor last year.

“But it’s clear that if we are to be able to defend ourselves against the competition we have to continue to advertise – we can’t shrink our marketing any more,” said Andreas Jansson, press officer at Svenska Spel.

For the Gaming Board, whose responsibility it is to ensure that only gambling firms approved in Sweden can advertise in the Swedish media, the situation is not an enviable one.

Sweden’s courts have effectively stood still on the gambling issue, waiting to see whether, and how, the state will react with legislation to international firms targeting Swedish gamblers. Another factor is that the EU is threatening to haul Sweden before the European Court over the matter.

Some weeks ago the government delayed resolving the issue still further. Swedish gambling legislation will be the subject of an inquiry, the results of which are not expected until 15th December 2008.

“We’ve got a long journey ahead of us,” said the Gaming Board’s Håkan Hallstedt.