There have been disturbing noises from Norway regarding a possible ban on online gambling, and recent events show them to be more than just talk: Norwegian Minister for Culture and Church Affairs, Trond Giske, has submitted a law proposal that could ban financial institutions from processing gambling transactions in pretty much the same way UIGEA did in the US, and it is expected to pass into law by next year. This move is raising controversy across the board, and not just for the obvious reasons.
As we had previously reported, Giske had been considering introducing a Norwegian version of the UIGEA. But since online gambling was already technically illegal under the existing laws, what the Ministry proposed instead is a mere “clarification”: existing Norwegian laws forbid marketing or “mediating” for online gambling, and this proposal would clarify that “mediation” actually means “payment processing”, hence making it illegal to transact financially with online gambling companies. A source at the Ministry of Culture and Church Affairs told Gamblingcompliance.com: "there had been some debate as to whether payment processing was covered under the term 'mediating'. The new proposal has made the definition much more precise."
The ostensible reason for promoting this bill is the government’s concern about problem gambling. “Several millions of Norwegian players probably spend millions of (Norwegian) crowns every year on these money games. Many of them can get into economical and social problems that they can not handle, because of the betting,” declared Giske, adding that the indexes of gambling problems strongly decreased after the state took control over slot machines. But it looks like controlling the slot machines was not enough to curb problem gambling and the Ministry still had cause for concern. Says Giske: “We are seeing a strong increase of inquiries to the Help Hotline from people with gambling problems concerning internet gambling. The bill on stopping payments to unlawful gambling will stop gambling addiction from spreading.” The statistics he quoted to support this are indeed cause for concern: Help Hotline calls regarding to internet gambling problems have increased a full 30% compared to 2005, and 19% compared to 2007.
However commendable the Ministry’s concern with problem gamblers may be, many poker experts are not buying it as the only reason for this proposed bill, suspecting instead that it is more about reinforcing Norway’s gambling monopoly. For instance, the clampdown on slot machines that took place in 2006 banned all slot machines except those belonging to Norsk Tipping, the Norwegian government-run gambling monopoly, resulting in a 4.6% revenue growth for Norsk Tipping (according to Online-casinos.com). This starts raising the questions from the experts: are the bans meant to protect Norwegian players, or the Norwegian gambling monopoly? By outlawing money transfers to gaming companies, the law would be effectively blocking offshore gambling companies from operating within Norway, leaving Norsk Tipping the sole provider of gambling services. It is hard to see how this will significantly address the issues of problem gamblers.
There is more: Norway is not a member of the EU, but it is part of the EU’s market and Economic Area, and joined the European Free Trade Association (EFTA) in 1994, agreeing to free mobility for merchandise, services and capital in the whole area. A protectionist move such as this is not going to go down well with the European market, which is currently penalizing the US because of the UIGEA’s similar protectionist leanings.
The proposed amendment to the law is now open for discussion until February 2008, after which it will be voted in Parliament. Giske and the Ministry for Culture and Church Affairs expect it to pass into law by the middle of next year.