Cherry loses Swedish licence extension appeal over organisational concerns
Seven online gambling licences restricted to two years following court ruling
Swedish operator Cherry AB has lost a court appeal to have its seven Swedish online gambling licences extended to five years, with the court citing potentially “hard to estimate” risks in Cherry’s consumer protection protocols.
The SGA had initially applied the two-year limit to Cherry based on “uncertainty” surrounding the organisational structure, including the need for seven separate licences, which could help the operator do more bonusing than regulation would otherwise allow.
The SGA claimed a shorter licence period gave it the opportunity to evaluate whether Cherry’s organisational model meets the requirements of the Swedish Gaming Act.
In its ruling this week, the Swedish administrative court in Linköping said Cherry’s organisational ability to operate egaming and sports betting could not be determined, necessitating the need for a shorter licence period.
As a result, the court said Cherry’s organisational ability to operate egaming and sports betting could not be determined, necessitating the need for a shorter licence period.
The court said “difficult-to-understand risks” could be identified in Cherry’s business model, specifically around consumer protection
In its appeal, Cherry had disputed the SGA’s claims its current organisational structure would pose a greater risk to compliance and legal requirements than any other licensed firm.
The operator cited the lack of regulatory enforcement action against it as evidence its structure did not impede its ability to be compliant.
Cherry alleged the SGA were “inconsistent and discriminatory” in its licensing stance, granting five-year licences to other firms who had previously violated Swedish gambling law.
Finally, Cherry claimed the SGA’s decision to limit the licence to two years was an “arbitrary and disproportionate punitive” measure against the company, which contravened Swedish law and EU law.
The ruling affects online gambling and sports betting licences for Casinostugan Limited, ComeOn Sweden Limited, XC Gaming Sweden limited, Cherry Casino Sweden, Hajper Limited, Faster Limited and MOA Gaming Sweden limited.
Cherry received its seven online licences (and one land-based licence) in December 2018. A spokesperson for the company said it had lost its appeal by only one vote and was currently evaluating a second potential appeal against the decision.
Last week, Maltese-headquartered operator LeoVegas won its appeal to have its licence extended from two years to five years, in a similar hearing in the Swedish Administrative Court.