Nordic regulators struggle to measure online gambling black market

A new academic review published in the respected journal PLOS One has raised concerns about the capability of gaming regulators in the Nordic region to accurately understand and measure the size and impact of online gambling conducted outside regulated systems. The review highlights persistent weaknesses in the way offshore gambling activity is estimated and suggests that regulators must improve cooperation and adopt more transparent analytical methods to avoid policy decisions based on incomplete or misleading information.

The Nordic countries of Denmark, Finland, Sweden and Norway have well established frameworks for overseeing gambling within their jurisdictions. However estimating the scope of online gambling that occurs through unregulated or offshore operators remains a major challenge for policymakers and public health authorities alike. The academic review examined a large body of research and found that current efforts to quantify offshore gambling are often inconsistent, lacking reliable data and, at times, influenced by political or commercial considerations.

Review methodology and findings

The review examined 32 studies conducted between 2010 and 2024 on offshore gambling estimates in the Nordic region. These studies collectively attempted to quantify the prevalence and financial scope of gambling conducted on sites that are not licensed by national regulators. The review concluded that the methods used to measure offshore activity vary widely and none provides a dependable standard for accurate estimation.

Lead authors of the review include Virve Marionneau from the University of Helsinki, Søren Kristiansen from Aalborg University, Tomi Roukka from the Finnish Institute for Health and Welfare and Håkan Wall from the Karolinska Institute. They describe the measurement of offshore gambling as a “politically sensitive topic with inherent uncertainties” and warn that many existing figures should be treated with caution when used in policy deliberations.

Lack of a reliable measurement standard

A key finding of the review is that there is no single “gold standard” method for accurately assessing offshore gambling across the Nordic countries. Most existing estimates, whether published by government regulators, industry groups or independent researchers, depend heavily on data obtained from a single private intelligence provider, H2 Gambling Capital. Although this firm’s figures are widely cited, the authors of the review note that the underlying methods and assumptions are not transparent, reducing confidence in the results.

This lack of transparency means that even regulatory agencies may not fully understand how offshore gambling estimates are produced or on what basis they rest. The review states that “methodological choices, data resources that have been used and political interests can have an effect on the kinds of estimates that are produced.”

Political use of offshore gambling estimates

The review also highlights how offshore market estimates have been used as political tools in debates about gambling policy. Research included in the analysis found that some industry sponsored studies have been used to argue against stricter regulation by suggesting that offshore gambling levels are rising rapidly. One Swedish study claimed that users of unlicensed sites spend 10 to 20 times more than those on licensed platforms, but the review found “no empirical basis nor conclusive descriptions” explaining how this figure was calculated.

Industry funded reports often produce higher estimates of offshore gambling than government produced figures, according to the review. These discrepancies can be linked to differences in methodology such as omitting uncertain responses from surveys or using novel but unvalidated data sources like website traffic analyses. The authors note that such choices can significantly affect the resulting estimates and therefore influence public perception and policymaking.

Offshore and onshore markets are not separate

Another significant observation in the review is that offshore gambling is often not a completely separate market segment from regulated onshore gambling. For example, in Finland, researchers found that 98 percent of individuals reporting offshore gambling also participated in gambling through licensed national channels. Despite this overlap, these players may still allocate a significant portion of their spending towards unregulated operators.

This finding challenges the common assumption that offshore gamblers are disengaged from regulated markets. Instead, many individuals participate in both markets simultaneously. The review also notes that offshore gambling products tend to include the most risky categories such as high speed online casino games and live betting formats.

Implications for policy and enforcement

The authors argue that regulators need more robust evidence in order to make effective decisions about harm prevention and consumer protection in online gambling. Currently regulators may be making strategic policy choices based on data that is incomplete, outdated or inconsistent. This can undermine efforts to protect vulnerable players and limit exposure to harmful gambling practices.

To address these weaknesses, the review recommends that regulators adopt more transparent and scientifically validated measurement tools. Rather than relying on a single data provider, authorities should consider multi method approaches. These could include population surveys, actual transaction data, customer help seeking statistics and sensitive financial data where feasible. Combined, these methods could provide a more accurate and reliable picture of offshore gambling trends.

Greater cooperation between Nordic regulatory authorities is also seen as a necessary step. Shared methodologies, coordinated data collection and joint analytical capacity would help to create more consistent estimates that policymakers can rely upon. The review emphasizes that without stronger cooperation and improved measurement standards, regulators will struggle to assess the true dimensions of offshore gambling activity and its impact on national gambling markets.

Moving forward with evidence based policy

The Nordic countries continue to evolve their gambling regulatory frameworks. Some jurisdictions are transitioning toward more open licensing systems, while others maintain strict monopoly based models. These changes make accurate measurement of offshore gambling even more important to ensure that liberalisation or regulatory tightening has the intended public policy outcomes.

In the absence of better measurement tools, the review concludes that regulators risk making high stakes decisions based on estimates that are too uncertain to serve as reliable foundations for policy reform. Such uncertainty might affect future licensing decisions, marketing restrictions, enforcement strategies and public health initiatives aimed at reducing gambling related harm.

Conclusion

The findings of this academic review underscore a structural weakness at the heart of gambling regulation in the Nordic region. While policymakers frequently rely on offshore gambling estimates to justify regulatory strategies, licensing reforms and enforcement priorities, the evidence base supporting these figures remains fragmented and uncertain. The absence of a transparent and scientifically validated measurement standard creates a risk that policy decisions of significant social and economic consequence are shaped by assumptions rather than demonstrable facts.

The review makes clear that offshore gambling should not be treated as a distant or isolated phenomenon. Instead, it exists alongside regulated gambling and often involves the same consumers moving between licensed and unlicensed environments. This overlap complicates enforcement narratives and challenges simplified claims about market displacement. It also highlights the importance of understanding player behaviour in its full context rather than relying on headline figures that may exaggerate or understate actual risks.

From a governance perspective, the continued dependence on opaque proprietary data sources raises legitimate concerns about accountability and methodological integrity. When regulators themselves lack clarity over how key metrics are produced, confidence in evidence based regulation is weakened. This creates vulnerabilities not only for consumer protection frameworks but also for the legal defensibility of regulatory decisions that may be challenged by affected stakeholders.

The path forward identified by the researchers is both pragmatic and achievable. Greater regional cooperation, combined with multi method data collection and transparent analytical standards, would significantly strengthen regulatory capacity. By grounding gambling policy in robust and independently verifiable evidence, Nordic regulators can better balance market oversight, public health objectives and legal certainty.

Ultimately, effective regulation of online gambling depends not on the volume of data collected but on its quality, transparency and relevance. Without meaningful improvements in how offshore gambling is measured and understood, the risk remains that regulatory responses will continue to chase an uncertain target. The review serves as a timely reminder that credible evidence is not merely a technical requirement but a cornerstone of lawful, proportionate and responsible gambling regulation.

FAQs

What is offshore online gambling and why does it matter?
Offshore online gambling refers to gambling activity conducted on websites that are not licensed in a given jurisdiction. Such activity can reduce consumer protections, weaken regulatory oversight and undermine public policy goals related to responsible gaming.

How do regulators currently estimate the size of the offshore gambling market?
Regulators and researchers often use a mix of industry data, proprietary intelligence from private companies, surveys and web traffic analysis to estimate offshore gambling activity. However existing methods vary widely and may lack transparency.

Why do the authors say there is no reliable measurement method?
The authors found that different studies use a range of methodologies that produce inconsistent results. No single method was capable of delivering a reliable estimate of offshore gambling across the Nordic region, often due to data and methodological limitations.

How are offshore gambling estimates used politically?
Offshore gambling figures are sometimes used to support or oppose regulatory changes. High estimates may be presented to argue for looser rules, while low estimates might be cited in favor of stricter controls. These figures can therefore influence policy debates.

What risks arise from inaccurate offshore gambling estimates?
Decisions based on weak or inconsistent data can lead to ineffective or counterproductive policy choices, undermine public trust and fail to adequately protect vulnerable players from gambling related harm.

Are offshore and onshore gambling markets separate markets?
According to research, many players participate in both onshore and offshore gambling, indicating that the two are not entirely separate and that offshore activity cannot be viewed in isolation.

Why is transparency in data important for offshore gambling measurement?
Transparent data allows regulators, researchers and policymakers to understand how estimates are derived, increasing confidence in their accuracy and reducing the potential for manipulation.

What are multi method approaches to measuring gambling activity?
Multi method approaches combine several sources of data such as surveys, transaction records, help seeking statistics and payment system information to create a more comprehensive and reliable assessment.

How can Nordic regulators improve their measurement capacity?
Regulators can share resources, adopt scientifically validated tools, standardize methodologies and leverage cooperation to build stronger capacity for analyzing offshore gambling activity.

What role do public health objectives play in gambling regulation?
Public health goals focus on reducing harm related to gambling, such as addiction and financial stress. Accurate measurement helps regulators design policies that protect consumers and minimize harm without impairing lawful recreational gaming.