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Gambling law update – DNS blocking and enforcement of the payment transaction ban

New provisions under the Gambling Act will lead to DNS blocking of unauthorised international gambling websites in Norway commencing in 2025.
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The Gaming Authority has already initiated an audit to identify which websites are subject to blocking, and many gambling companies have already received pre-warning letters from the Gaming Authority. Also, “circumvention” of the payment transaction ban (Norwegian banks are required to block payment transactions for foreign gambling offers) is now, according to the authorities, considered to be sufficient for a gambling offer to be “aimed at” Norway.

DNS-blocking

DNS blocking prevents access to specific websites by displaying a message that the site is unavailable in Norway instead of connecting to the gambling site. This measure is part of the Norwegian Parliament’s strategy to protect consumers from foreign gambling offers. Internet service providers will be ordered to implement the blocking.

In the fall of 2024, the Gaming Authority began supervising and informing companies offering gambling services “in Norway” about the upcoming DNS blocking. According to the Gaming Authority, these companies will have the option to exit the Norwegian market voluntarily. If they choose not to, the Gaming Authority has stated that it will proceed with a formal notice and instruct ISPs to block their sites. The first DNS blocking will be implemented in the spring of 2025.

Several major gambling companies have already begun withdrawing from the Norwegian market. According to the Gaming Authority, simply changing the website’s language to English is insufficient.

Despite the upcoming DNS blocking, Norwegian residents are not prohibited from gambling on foreign websites. The new provision in the Gambling Act provides that:

“If a website offers gambling aimed at the Norwegian market without a permit … the Norwegian Gaming Authority may order internet service providers to implement DNS-blocking of the website. The order may stipulate the content and form of the landing page operated by internet service providers.

An order … may only be issued if the considerations that speak in favour of issuing the order outweigh the disadvantages the order will cause. In the assessment, the interests that indicate DNS blocking shall be weighed against the interests of internet service providers targeted by the order, the website owner, freedom of information and expression and other affected interests.”

The first criterion, “aimed at the Norwegian market,” requires assessing whether the gambling site actively targets its gambling offer and marketing towards Norwegian customers. The Ministry of Culture has, in the preparatory works for the Money Gaming Act, stated that the following factors may be included in the assessment:

  • whether the gambling site offers Norwegian as a language
  • whether the gambling site offers the use of Norwegian currency
  • whether the company behind the activity is Norwegian or has a connection to Norway, for example with a Norwegian address
  • whether the gambling site markets itself in Norwegian channels
  • whether the gambling site uses Norwegian persons in its marketing
  • whether profits from the gaming activity are earmarked for Norwegian organisations
  • whether the gambling site refers to Norwegian assistance services
  • whether the gambling company actively attempts to circumvent the payment transaction ban

The Ministry has also stated that the above list is not exhaustive because the gambling market is dynamic and that it may vary over time how gambling offerings that are not licensed in Norway are organised. If a provider actively has structured the offer so that it specifically targets players in Norway rather than players in other countries, the offer will, in principle, be considered aimed at the Norwegian market. Here, the use of the Norwegian language in offers or marketing will be the most important factor. Still, other arrangements indicating the offer is tailored to a Norwegian audience will also be considered.

The relation to the payment transaction ban – use of third-party solutions that work for Norwegian residents is deemed sufficient to target Norway

In its administrative practice, the Gaming Authority has recently (November 2024) sent warning letters of DNS-blocking and coercive fine warnings to gambling operators allegedly targeting Norway. The Authority now alleges that accepting bets from Norwegian players in itself circumvent the payment transaction ban in the Gambling Act. According to the Authority, this is sufficient to conclude that an operator targets Norway and thus falls within the ban of foreign gambling offers “in Norway”.

At the outset, the payment transaction ban comprises companies that provide payment services in Norway. The ban applies, among other things, if the transaction is marked with a merchant code for gambling (MC 7995) or if the Gaming Authority has ordered the company to stop the transaction. The obligation to suspend payment transactions applies both to payment transactions to and from gambling companies that are not licensed in Norway and to payment transactions to and from other companies that mediate payment transactions on behalf of gambling companies that are not licensed in Norway.

The latest development is that the Gaming Authority claims that card transactions not marked with the MCC 7995 are a violation. Since Norwegian customers cannot choose direct payment to gambling operators, the Authority asserts that this alleged “circumvention” of the Norwegian payment transaction ban is a violation.

“When the Norwegian Gaming Authority has performed test games, we have chosen to pay by Mastercard or Visa. However, we have not chosen to have the payment go to a third-party solution or payment intermediary, even though there are also payment solutions on offer. We know that Norwegian banks often find it difficult to recognize payments from third-party solutions as a gambling transaction. This becomes even more difficult when the transactions are not correctly labelled with MCC 7995 according to the industry standard. (…)

The Norwegian Gaming Authority assumes that using third-party solutions that use the wrong MCC is done deliberately to mislead the banks. This prevents the transactions from being stopped by companies that provide payment services in Norway under the Gambling Act’s rules. (…) By circumvention in this context, we mean a deliberate strategy to prevent the banks from uncovering the gambling transactions.”

This likely means that the Norwegian authorities will deem international third-party payment solutions that work for Norwegian gambling customers going forward as sufficient to establish a breach of the Gambling Act by the gambling operator even if no other activities are directed against Norway.