The Norwegian Way: How Government Controls the Market
When it comes to controlling online casino business, Norway belongs to the list of the most draconian governments in the world. Nordic officials are cold blooded predators towards foreign enterprises that want to enter the market and try to lure in their citizens. Working in such tough nearly hostile environments is no easy task, but some companies manage to stay under the radar. Simultaneously, there are people in the country who readily use VPN and explore the world of online gambling outside virtual borders of their homeland.
The total monopoly
State controlled industry is actually a generally accepted practice and many world economies either fully take control over the market and its inner regulations or try to squeeze all related enterprises in a single area to maintain strict supervision without spending millions on enforcing rules. The parliament certainly decided to choose the former many years ago and created two separate institutions each with its own set of functions and privileges. Here are these two orgs:
- Betting Governing Body. This is a special organization that mostly controls the access of the population to games like Keno and Bingo. All national lotteries as well as betting on sports are also fully operated by this institution. This organization abides only the higher-ups.
- National Tote Institution. This another important state-run corporation that mostly involved in overseeing and managing all wagers in regards of horse racing. There are several other smaller important functions regarding wagers that are also overseen by this institution.
All other enterprises are effectively banned all across the whole economy. The legal environment is not welcoming and many big names in the European market were turned down when applying for a local license. The thing is that technically other foreign brands are allowed to enter the competitive environment of the economy, but the officials have the right to decline any applicant. Some people are incentivized against playing on international websites since all their winnings must be reported for taxing.
The atmosphere is more than acidic towards independent businesses that want to take the piece of the juicy Noridc pie. However, this strategy is overly protective and does prevent local people from becoming victims of scammers which are sadly plentiful in our domain. The fear of allowing a fraudulent enterprise to hunt on their citizens make Nordic official departments panic.
Why is it a problem at all?
Slot machines are bread and butter of many gamblers who enjoy testing their luck. It is one of the quickest and most satisfying ways to experience the thrill of risking your money and winning. This is why these machines evolved quickly and slowly turned into entertainment monstrosities standing in Las Vegas or Monaco halls. Nordic countries were not behind the world. In fact, the overall yield of all one-handed criminals reached a whooping 26 thousand million kroon in 2004. This was the moment of realization that politicians and lawyers must step in and start administrating.
The solution was quite harsh and all slot-games were effectively banned during the summer of 2007. There is a plenty of enthusiastic inventive developers and businessmen and soon a new special entertainment was introduced to locals – interactive video terminals that are essentially preinstalled PCs with restricted access that can be used only if you have a special card. However, this is not a solution for a nation where up to 3% of annual income of an average citizen is spent on gambling.
Since 2009, many locals started to seek sources of entertainment outside their own borders. The amount of people who decided to use VPN or play in officially allowed websites with digital forms of slots has been on steady rise during the last decade. This trend will not stop as long as the parliament does not come up with a solution how to allow their citizens to keep playing their favorite games without giving up their control.
This country has that authoritarian approach to managing the world of casinos. However, industry experts do not believe that this is the way to go. Many believe that changes must be made and quickly.