Swedish online gambling trade association Branschföreningen för Onlinespel (BOS) has spoken out against the Swedish government's approach to illegal gambling activities, saying that imposing certain restrictions on licensed operators would allow illegal sites to increase their market share.

The Swedish Gambling Authority (Spelinspektionen) released figures this week showing that the share of licensed gambling in Sweden is between 85 and 87%, with the remaining share being taken up by the black and grey market.

The BOS noted that this is below Spelinspektionen's previous estimate, and also below the government's planned channel target that at least 90% of gambling in Sweden takes place on licensed platforms.

The association, which had previously raised concerns about channeling, also said that 85% and 87% of the share are accounted for by all forms of gambling in the country, not just gambling. According to the BOS, the sewerage rate for online casinos and bettingidor utan svensk licens is lower.

"No one who hasn't been paying attention to the political surge and astronomical fines for licensed gambling companies can be surprised by this development," said BOS general secretary Gustav Hoffstedt. "I believe that the decline is part of a trend. Unless the government takes decisive action to protect its own over-regulation, the sewers are likely to shrink even further."

Spelinspektionen has taken action to crack down on illegal gambling activities by imposing a number of sanctions against licensed operators who violate gambling laws.

The government is also currently mulling proposals to introduce stricter rules for gambling marketing, including a complete ban on advertising, similar to the new installation in Italy.

In addition, licensed operators in the country could be forced to close certain betting markets if the new rules come into effect. The announced plans include a ban on betting markets that can be affected by a single player in a match, such as corner kicks, yellow and red cards.

However, the BOS has criticised this approach, saying that forcing licensees to comply with additional rules and regulations could open the door to unlicensed websites that do not have to comply with the law in order to gain a larger market share.

"The discussion of marketing restrictions for licensed online casino operators in these circumstances, as well as the banning of some popular gambling establishments, shows that the government does not understand the seriousness of the situation," Hoffstedt said.

"Such restrictions would effectively mean handing over the Swedish gambling market to unlicensed operators. The government is currently acting as the best friend of the black and grey market and this needs to end."

This week Spelinspektionen reported a quarterly increase in revenue from licensed gaming in the three months to the end of September, but saw overall market revenue fall over that period.

Commercial online gambling and betting combined with online gaming on ships in international traffic amounted to SEK3.48bn (£281m / €327m / $362m), up from SEK3.48bn in the second quarter. Total gambling revenue during the period was SEK5.90bn, down from SEK6.11bn in the second quarter.