Norway proposes an exception to consumer protection rules for gambling

The Norwegian Ministry of Children and Family has proposed that gaming be exempted from the country's Right of Withdrawal Act in a draught law filed to the country's legislative body, the Storting.

The Right to Withdraw Act governs contracts between consumers and enterprises.

The Ministry claims in the proposed change that gaming should be exempt from the law since the requirements for prior notice and the ability to withdraw are "difficult to implement" for gambling activities.

The Right of Withdrawal Act, enacted in 2014, codifies a 2011 EU consumer rights directive into Norwegian law.

Among other things, the law specifies what information a firm must present before entering into an agreement with a consumer and provides the customer 14 days to cancel the agreement.

While the EU regulation included a provision exempting games of chance from the restrictions, the Norwegian statute did not.

The plan is the result of negotiations with a number of Norwegian government entities, academic institutions, political organisations, gaming firms, and non-governmental organisations (NGOs).

Reaction from the industry

Industry's reaction to the Act's modifications was divided. The Norwegian Industry Association for Online Gaming (NBO), the country's online gaming sector association, commended the bill's provisions but claimed that the true issue was severe regulation bolstering the power of the illegal market.

“The Norwegian Online Gambling Industry Association understands the ministry’s wish to amend the Right of Withdrawal Act so that it is more in line with today’s consumers’ relationship with gambling,” it stated in a response to the consultation. “As they write, it is a main principle in Norwegian gambling policy ‘to channel gambling activity towards safe and sound gambling offers that are subject to public control.’

“And to succeed in that, ‘the games Norsk Tipping and Norsk Rikstoto offer must have sufficient competitiveness and be user-friendly.’”

“This is not the case either with or without the amendments to the Right of Cancellation Act.”

The NBO also cited H2 Gambling Capital's research of the level of channelisation rate for online gambling in Norway, stating that non-Norwegian regulated enterprises would account for 67% of the whole market in 2021. It was emphasised that this indicated that more than half of the online sports betting and igaming sector occurred outside of the context of national regulation.

“It is all the more gratifying to see that the ministry indicates in the consultation letter that they have checked with the applicable law and practice in a number of European countries regarding their application of the right of withdrawal for gambling,” continued the lobbying organisation. “What these countries have in common is that they have also chosen to regulate gambling through a licensing model – with the exception of Finland, which is expected to adopt this shortly.”

The Norwegian gambling authority Lotteritilsynet revealed in January that the number of banks informing consumers about illicit transactions has grown since the study's inception in 2020.

By fLEXI tEAM