Stockholm-listed gambling operator Kindred Group is going to appeal the decision by Lotteritilsynet (the Norwegian Lottery Authority) to fine its Malta-based subsidiary Trannel with NOK 1.198 million ($117,164) per day starting on October 5.
Kindred Group Continues Operations, as Usual, Awaiting the Court Decision
Kindred Group CEO Henrik Tjärnström has announced that his company is going to appeal the massive fine Lotteritilsynet issued its subsidiary and Unibet operator Trannel: “We will appeal the decision of the Lotteritilsynet regarding the issuance of this sanction fee and will continue operating as usual, as long as the legal process is ongoing. We want to see how it pans out.”
Tjärnström further elaborated that Trannel is licensed in Malta and it is not active in Norway. According to European Economic Area legislation, if Norwegian customers wish to play on a foreign website, they are free to do so. Trannel just accepts the Norwegian customers that find its services in Malta.
The hefty fine follows a cease-and-desist order from the regulator issued back in April 2019, as Trannel, which has a license granted by the Malta Gaming Authority (MGA), was providing gambling services to the Norwegian market without the necessary mandatory license.
The Norwegian regulator has pointed to the Trannel operations in Norway as illegal and has also shared a survey revealing that most Norwegians that play games offered by Trannel are not aware that they are illegal.
The stock market also responded in a meaningful way to the Norwegian fine. Kindred Group’s shares tumbled down by 7.2% on September 21, which corresponded to a market capitalization decrease by SEK 1.5 billion ($133 million).
Previous Appeals of Lotteritilsynet’s Cease-And-Desist Order Were Discarded
June was not a good month for Kindred Group. First, it was the Oslo District Court that discarded its appeal aiming to overthrow the cease-and-desist order by Lotteritilsynet.
The court refused to accept the argument presented by Kindred Group that because it holds a license in Malta it is allowed to offer its gambling services to all countries in the European Economic Area (EEA).
Previously Kindred Group appealed the decision with the Norwegian Ministry of Culture and the Lottery Board, however, both of the appeals were discarded.
Later on, in June, the company received a further warning from Lotteritilsynet that serious fines will follow unless the company leaves the Norwegian market but Kindred Group did not do anything about it and just continued business as usual.
Consequently, the Norwegian regulator slapped Kindred Group’s subsidiary Trannel with a massive fine, which the company will now try to appeal.