On the front foot: Why compliance needs to become proactive rather than reactive

We are only a few months into Sweden’s regulated online gaming regime, and it is already clear for everyone to see that the rules of the game have shifted. The Swedish Gambling Authority has not been shy when it comes to handing down hefty fines to operators which breach its rules. Meanwhile, the country’s Minister of Civil Affairs Ardalan Sherakabi singled out sports betting operators over reports that they were allegedly accepting wagers on football matches involving players under the age of 18.

Of course, it is to be expected that the implementation of a new regulatory framework will be accompanied by some growing pains. Mistakes will be made and, hopefully, learned from. But even in the early days of the re-regulated Swedish market, it is becoming very apparent that the operators and suppliers having the most success are those which were most prepared for the country’s transition from grey to white.

Swedish challenges

Sweden’s new framework was not a bolt from the blue. It had been discussed and debated for several years, and the guidelines and requirements were laid out to stakeholders well ahead of January 1, 2019, when it came into force.

But nonetheless, many have struggled to comply.

This is in part the result of two factors. Firstly, that the Swedish egaming framework introduced a couple of unique and challenging requirements that both operators and suppliers had no previous experience in meeting. The most notable of these revolved around strict bonusing restrictions, but also a high bar for responsible gaming including a self-exclusion registry.

The reason many have struggled to meet these requirements – and some have incurred heavy fines – is that they have treated compliance as an afterthought during a time when it is now perhaps the most important single demand for a multi-jurisdictional supplier or operator targeting regulated markets. Take the example of the Sweden’s tough rules on bonusing, which essentially prohibit further bonuses being given to players beyond the initial sign-up.

Many of the most popular slots and games are predicated on a repeated bonusing mechanic; marketing teams have primarily competed on bonusing for the past few years. It is a simple reality that many of these techniques simply cannot be replicated in Sweden since the new framework has come into force.

Preparing for the unknown

Instead, operators and suppliers alike have had to tear up the rulebook and, in many instances, start again. But it doesn’t have to be this way. Those growing fastest in Sweden – and indeed those who will grow fastest in the next market to turn white – are the ones who take a very different approach to compliance.

This means not treating new compliance demands – such as those we now face in Sweden – as something to react to, but rather something that can be prepared for ahead of time.

This can be achieved by building compliance into the core functions of your business. For instance, if you are a games developer, new titles should be developed with compliance front of mind. This doesn’t just mean analysing your key markets and ensuring the game is compliant. It means building a product that is flexible enough to adapt to an ever-changing regulatory landscape, whether that be new markets or new requirements.

Similarly, does your marketing team have access to compliance expertise? Is it building new campaigns with the latest regulations in mind? Essentially, the egaming industry is being asked to prepare for the unknown. And the only way to achieve this as the regulatory environment continues to change is to ensure compliance is considered every step of the way.

Author: Antonio Zanghi, founder, Maxima Compliance

Antonio Zanghi is an online gambling compliance expert with years of experience in the field. He has previously worked at IGT where he was involved with both regulatory and technical compliance successfully managing compliance in the Canadian and European regions. Antonio now runs Maxima Compliance, a full-service compliance consulting firm supporting online gambling businesses.