Sweden’s Bonus Rules and Gambling Reform Debate

Sweden’s gambling industry is once again under scrutiny as policymakers, regulators, and operators clash over the country’s strict bonus rules and their unintended consequences. Since the implementation of Sweden’s re-regulated gambling framework in 2019, the aim has always been to protect consumers, prevent problem gambling, and ensure that gambling remains within licensed and monitored environments.

However, despite these intentions, evidence increasingly suggests that the rigid bonus restrictions — limiting licensed operators to offer only a single sign-up bonus per player — are driving many players to unlicensed international sites. As debates intensify, the push for stronger licensing reforms has become one of the most pressing policy issues in Sweden’s gambling landscape.

The origins of Sweden’s gambling regulations

When Sweden officially opened its regulated online gambling market in January 2019, it marked a major shift from a state monopoly to a liberalized system. The reform aimed to create a safer, more transparent gambling environment, where all operators serving Swedish consumers would be required to hold a national license issued by Spelinspektionen, the Swedish Gambling Authority.

The government sought to balance the benefits of competition with the protection of public interests. To achieve this, strict measures were introduced — most notably, the limitation of promotional bonuses. Under current regulations, operators can only offer one sign-up bonus per player, typically capped at SEK 100 (approximately €9). Ongoing incentives such as cashback, free spins, or VIP rewards are strictly prohibited.

In addition to these restrictions, the Swedish government also imposed a weekly deposit limit of SEK 5,000 (around €450) for online casinos. The aim was to curb excessive spending and promote responsible gambling behavior.

While the objectives were noble, the outcomes have been more complex than anticipated.

Players turning to unlicensed operators

A growing number of Swedish players are choosing to bypass the regulated market in favor of international, unlicensed platforms that offer more attractive bonuses, cashback deals, and loyalty programs.

According to official data, approximately 15% of all gambling activity in Sweden now occurs on unlicensed sites. This shift has caused concern among regulators, as these platforms often operate outside Swedish jurisdiction, meaning they are not bound by local consumer protection laws, self-exclusion systems, or tax obligations.

The government has long pursued a channelization goal of 90%, meaning that nine out of ten players should use licensed operators. However, the latest data indicates that the channelization rate has slipped from 86% in 2023 to 85% in 2024.

This year’s assessment incorporated both player surveys and internet traffic analysis for more accurate insights. Over 5,700 respondents participated in the study, which examined traffic to more than 2,000 unlicensed gambling websites.

The findings revealed that online casinos are primarily responsible for the declining channelization rate, with estimates placing their rate between 72% and 82%, compared to 92% to 96% in the sports betting and horse racing sectors.

Spelinspektionen attributed the weaker performance of online casinos to regulatory constraints that make offshore sites more appealing.

The psychology of gambling bonuses

Bonuses are a major attraction for online players. Studies from multiple jurisdictions, including research by the UK Gambling Commission (UKGC), have shown that promotional offers significantly influence player behavior. In fact, 31% of respondents in a UKGC survey admitted that bonus offers encouraged them to engage more frequently with gambling sites.

For many players, bonuses provide excitement and a sense of reward without risking large sums of personal money. The absence of these incentives in Sweden’s licensed market has therefore contributed to players seeking better opportunities abroad.

According to Spelinspektionen’s 2024 report, 21% of Swedish gamblers who use unlicensed casinos stated that they do so specifically because of larger bonus offerings. Additionally, 35% said they believe offshore casinos provide better chances of winning, while 23% cited their exclusion from Spelpaus, Sweden’s national self-exclusion program, as the reason for their migration to unlicensed platforms.

The legal grey zone of offshore gambling

Offshore gambling operators occupy a legal grey area in Sweden’s current framework. While these companies are not officially permitted to target Swedish players, certain loopholes in the Gambling Act allow them to operate indirectly.

One key issue lies in the “directional criterion”, a legal standard that applies Swedish law only to gambling operators that explicitly target Sweden. In practice, this means that if a foreign operator structures its services to appear “non-Swedish” — for example, by avoiding Swedish-language content, marketing in local media, or using the Swedish krona — it can still accept Swedish players without technically violating the law.

Recognizing this loophole, Marcus Isgren has proposed a significant amendment to Sweden’s Gambling Act. His proposal would replace the “directional criterion” with a “participation criterion”, making it illegal for any operator to offer gambling services to Swedish residents, regardless of language or marketing focus.

If enacted, this reform would significantly strengthen the ability of regulators to block offshore operators and close one of the most exploited gaps in the country’s gambling laws.

Proposed enforcement measures: IP and DNS blocking

One of the most discussed enforcement tools is the introduction of IP and DNS blocking to restrict access to unlicensed gambling sites.

Anna Johnson, President and CEO of Svenska Spel, has been a vocal advocate for this approach. She has emphasized the importance of legislative support to implement technical blocking measures, arguing that “it is absolutely necessary to go on with more measures to combat illegal gambling.”

According to Johnson, DNS blocking would not only strengthen the integrity of the Swedish licensing system but also enhance consumer protection by preventing players from accessing unsafe sites.

Such measures have already been implemented in several EU countries, including Denmark and Belgium, with varying degrees of success. Swedish lawmakers are now studying these models to assess their applicability within Sweden’s legal framework.

BOS’s stance and call for a new gambling inquiry

The Swedish Trade Association for Online Gambling (BOS) has been one of the most prominent critics of Sweden’s current gambling regulations. Despite its critical stance, BOS has welcomed the proposed reform that would prevent unlicensed companies from serving Swedish players.

Gustaf Hoffstedt, Secretary General of BOS, described the proposal as “an important contribution to strengthening the Swedish gambling market.”

In September, BOS called for a new comprehensive gambling inquiry, with the goal of identifying measures to improve channelization and ensure that licensed operators remain competitive.

One of BOS’s key suggestions is to relax restrictions on loyalty bonuses. Under the current rules, such bonuses are completely prohibited. Hoffstedt and others argue that allowing limited loyalty programs would help retain players within the regulated market and reduce the appeal of unlicensed platforms.

Sweden’s position in the wider EU gambling market

Within the European Union, Sweden’s gambling system stands out as one of the most restrictive. Some countries view Sweden’s model as a potential blueprint for consumer protection, while others see it as a cautionary tale of overregulation.

For instance, markets such as Denmark and the Netherlands have sought to balance consumer protection with commercial flexibility, permitting bonuses within controlled frameworks. These countries have achieved high channelization rates without entirely banning promotions.

Sweden’s challenge lies in maintaining its strong player protection standards while ensuring that the regulated market remains attractive enough to compete with offshore alternatives.

Looking ahead: balancing protection and competitiveness

The ongoing debate over Sweden’s bonus rules underscores a larger issue — how to strike a balance between consumer safety and market competitiveness.

Regulators and policymakers are under increasing pressure to adapt existing laws to the evolving realities of online gambling. If Sweden continues to lose players to unlicensed operators, it not only undermines consumer safety but also reduces tax revenues and weakens the authority of the regulatory framework.

Upcoming legislative reviews, including the potential adoption of the participation criterion and DNS blocking, could represent turning points in this effort. Whether Sweden chooses to soften its stance on bonuses or to double down on enforcement, one thing remains clear: the country’s gambling model is at a critical crossroads.

Conclusion

Sweden’s gambling sector stands at a pivotal moment, facing the difficult task of balancing strong consumer protection with a competitive and sustainable market. The country’s strict bonus restrictions, once seen as a model of responsible gambling policy, have increasingly shown unintended consequences — most notably, a steady migration of players to unlicensed platforms that operate beyond national oversight.

The government’s long-term goal of maintaining a 90% channelization rate remains under pressure, and current data suggest that continued rigidity may further weaken the regulated sector. Yet, the intent behind Sweden’s approach — to protect players and promote responsible behavior — remains commendable and necessary in a digital era where gambling is more accessible than ever.

Reform proposals such as the replacement of the directional criterion with a participation criterion, alongside potential IP and DNS blocking, could strengthen regulatory enforcement. However, these measures must be complemented by thoughtful adjustments to bonus and marketing rules if the country hopes to retain players within the licensed market.

Ultimately, Sweden’s challenge is not whether to regulate, but how to regulate effectively. Finding equilibrium between safety and freedom, between protection and participation, will determine the future of Sweden’s gambling framework. A more balanced system — one that safeguards consumers while allowing licensed operators to compete fairly — could restore public confidence, improve channelization, and secure Sweden’s place as a responsible yet dynamic leader in the European gambling landscape.

FAQs

What is the main bonus restriction in Sweden’s gambling market?
Licensed operators can offer only one sign-up bonus per player, typically capped at SEK 100.

Why were bonus restrictions introduced?
They were designed to prevent problem gambling and promote responsible play within licensed environments.

Why are Swedish players turning to unlicensed casinos?
Many players seek larger bonuses, better winning odds, or are blocked by the Spelpaus self-exclusion system.

What is the channelization rate in Sweden?
It measures how many players use licensed sites; it currently stands at around 85%.

What is the “directional criterion”?
It’s a legal rule stating that Swedish law applies only to gambling operators explicitly targeting Sweden.

What change has been proposed to the Gambling Act?
A new “participation criterion” would apply the law to any operator allowing Swedish players, regardless of targeting.

What enforcement tools are being considered?
Authorities are exploring IP and DNS blocking to restrict access to unlicensed websites.

Who is advocating for stronger enforcement?
Svenska Spel’s CEO, Anna Johnson, has called for legislative support to block illegal gambling sites.

What does BOS propose for reform?
BOS suggests easing restrictions on loyalty bonuses to make licensed casinos more competitive.

How does Sweden compare with other EU gambling markets?
Sweden is among the strictest regulators, while countries like Denmark and the Netherlands adopt more flexible models.