Finnish Gambling System Reform Is Underway — Licence Model to Be Introduced

Authors: Vilhelm Schröder and Axel Hård af Segerstad

From Monopoly to Licensing

For the past few years, public debate has been ongoing regarding the Finnish gambling monopoly and its partial opening to competition. With the rapid growth of foreign online gambling websites outside the monopoly-based system in Finland as well as the inability of authorities to efficiently control and prevent the provision of such services, opinions have largely changed in favour of reforming the current monopoly-based system.

As a significant step towards a transition, the current Finnish Government Programme states that the Government will be reforming Finland’s gambling system and opening it to competition using a licence model by 1 January 2026 at the latest. According to the Government Programme, the gambling licence system will, as a rule, cover online casino games and online betting.

In Finland, the objectives of the current Finnish Lotteries Act (1047/2001) are to ensure the legal protection of those participating in lotteries, to prevent misuse and crime related to lotteries, and to prevent and reduce the economic, social, and health-related harm resulting from participation in lotteries. Said objectives have so far been considered to be best realised in an exclusivity-based gambling system, where the wholly state-owned limited liability company Veikkaus Oy has had the exclusive right to run all gambling games.

Legislative Project in Progress

In accordance with the Government Programme, the Finnish Ministry of the Interior announced in October 2023 that it had set up a legislative project on the reform of the gambling system with the aim to introduce a licensing system for gambling. As background for the legislative project, the Finnish Ministry of the Interior had previously conducted a preliminary study investigating the current state of the Finnish gambling system and alternative models. One of the findings of the study completed in April 2023 was that gambling outside the monopoly system has increased, which, in turn, has led to significant gambling-related harm.

The legislative project of the Ministry of the Interior aims to prepare a report containing the necessary regulatory proposals regarding:

• gambling groups to be included in the scope of the licence system
• licence procedure and fees related thereto
• taxation
• special tasks of Veikkaus Oy as well as competition and corporate legal matters
• implementation of gambling activities
• monitoring, research, assessment, prevention, and treatment of gambling-related harm
• supervision of gambling operations, authority powers, and funding
• preventing misuse and criminal activities, as well as consumer protection
• marketing and sponsorship of gambling
• a centralised self-exclusion system and other necessary tools for managing gambling, and
• methods to combat gambling offerings and marketing outside the regulated system.

In addition, the relocation of slot machines to separate supervised premises is being investigated. It can be noted that the project may also address other subjects that are aligned with the objectives of the project.

Timetable

It has been reported that the preparation work at the Ministry of the Interior has proceeded according to schedule. Therefore, it is estimated that the extensive reform could be brought to the Parliament for consideration in the spring of 2025. The Ministry of the Interior estimates that companies providing gambling services could possibly, at that time, start applying for licences for the Finnish market. As the nature of the reform is exceptionally large, it is also possible that the reforms could enter into force at different stages rather than all at once.

We will continue monitoring and reporting on all key developments as the legislative project moves forward.