Swedish Gambling Authority U-turns on negative equity regulation
Following a judgment in the administrative court, the SGA has revoked its position on negative equity in regard to licensing reviews
The Swedish Gambling Authority (SGA) has reneged on its legal position in relation to the importance of negative equity in its licence reviews.
The decision follows a recent ruling in the Linköping administrative court which saw Avento’s licence renewal rejection overturned.
Avento applied for a licence renewal in Sweden in December 2022 but had its application rejected due to its negative equity in the two years following its licence award in 2019.
The court has overruled this decision, stating that the operator was now functioning in a positive financial position and that negative equity did not mean that the firm would be unable to fullfill its licence requirements.
Despite the ruling and announced retraction, the SGA has said that it still believes that negative equity means the suitability requirement cannot be fulfilled. The regulator also said negative equity would count against future applications.
In a statement, the SGA said: “The Swedish Gaming Authority believes that a capital guarantee from a private person cannot be accepted as a starting point in view of the difficulties in obtaining a reliable picture of a [company’s] financial position.
“The extent to which the group’s capital strength can be taken into account and what capital strength is required for the conditions for a licence to be considered fulfilled will be decided in each individual case,” it added.