Videoslots continues Swedish legal challenge after Supreme Court setback

Videoslots’ attempt to stop the Swedish government from enforcing temporary Covid-19 regulations due to non-compliance with EU law has been dismissed by Sweden’s Supreme Court. Videoslots asked justices at the Supreme Court to reverse a prior Svea Court of Appeal decision in October 2020 to limit company losses incurred as a result of complying with the country’s temporary Covid-19 regulations on bonus, deposit and session limits. In its legal challenge, Videoslots claimed the temporary regulations, sanctioned in June 2020, should not apply to the business because the Swedish state cannot justify the regulations under EU law due to their adverse effects on player protection. Videoslots argued that the regulations “unlawfully restrict” its ability to provide services which are guaranteed under article 56 of the Treaty for the Functioning of the European Union (TFEU). However, under EU law, member states can impose restrictions on the grounds of protecting public health, claims which are being used by the Swedish government as justification for the temporary restrictions. Videoslots said the company has only complied with the regulations to avoid potentially being fined by the SGA and having its Swedish licence revoked. In its legal challenge, the operator asked the court for an interim injunction to bar the Swedish regulator from applying the temporary restrictions pending a claim for payment of initial damages to the firm totalling SEK5.4m (£453,624). The SEK5.4m figure is calculated based on losses incurred by the company from imposing the restrictions between 2 July to 31 July 2020. “It can be reasonably feared that the state will force Videoslots to comply with the regulation and thereby complicating the company’s operations and causing loss of income and profit,” the lawsuit stated. “The damage is irreparable because the company cannot compensate for this lost income from other players. Some players can also be expected to quit the company for good. Videoslots may therefore need to leave the Swedish gaming market as a result,” the lawsuit added. Videoslots also asked the court to compel the Swedish government to repay any lost profit from the imposition of restrictions in July 2020 to the date of the judgement, a claim which if fulfilled would have seen the firm claw back significant losses from the regulator. The temporary regulations impose a SEK5,000 (£420) a week deposit limit on online casino gaming, as well as a SEK100 (£8.40) cap on one-time player bonuses and were implemented with the declared aim of mitigating any potential rise in harmful gambling during Covid-19. The operator publicly opposed the restrictions along with nine other operators in a letter sent to the Swedish government, a protest which ultimately proved unsuccessful. Opponents of the restrictions have claimed that Swedish channelisation rates to licensed operators have reduced following their implementation, with players increasingly drawn to unlicensed, unrestricted sites which operate without player protection standards. A victory for Videoslots would open the door to dozens of claims by Swedish-licensed operators, many of which have reported reduced revenue since complying with the restrictions. However, judges reviewing the case agreed with the lower Svea court ruling that an abstract judicial review is not provided for under Swedish law and is also not a requirement of a member state under EU law. As such, the Supreme Court dismissed Videoslots’ injunction request to bar the Swedish government from enforcing the temporary Covid-19 regulations. The underlying claim to award damages suffered as a result of the temporary Covid-19 restrictions on the grounds of non-compliance with EU law is still being considered by the courts, however. In a statement provided to EGR, Videoslots confirmed its commitment to continuing its legal challenge against the Swedish government’s measures. “Videoslots believes that it has a strong case and will continue to pursue the claim for damages while also considering new applications for interim measures,” the firm told EGR. Elsewhere, Videoslots has promoted director of customer services Peter Sjoberg to the role of COO. Industry veteran Sjoberg has previously held roles at Unibet and spent nine years at Betclic Group.