The Finnish government has introduced a bill to Parliament that will bring an end to the current monopoly on virtual casino games and online betting. The new Gambling Act will replace the monopoly with a licensing model to be applied from January, two years from now.

Veikkaus, Finland's official state-owned gaming authority, has had the monopoly on Finnish gambling business for a long time. But while Veikkaus is purportedly a monopoly entity, the past few years have seen its operations increasingly encroached on by foreign-based casino operators seeking what is ultimately a slice of the ever-expanding online games market. In illustration, for instance, is 888 Casino mobile casino - one of the established international operators to have achieved impressive amounts of traction in Finland.

The Finnish Competition and Consumer Authority estimated that around €520–590 million was spent gambling outside the monopoly system, with around 50% of that being spent on internet gambling. Finland is a promising market for gambling operators primarily due to the fact that it has very advanced digital infrastructure. Such an infrastructure enables such activities as player identification and monitoring of troubled gambling behavior. The Finnish market is especially appealing for gambling operators already present in other Nordic markets.

The reform will avoid and reduce harm from gambling by steering gambling activity to a controlled and overseen product operated by responsible operators. While Veikkaus may retain its monopoly over lotteries, pools, slot machines, and casino games, the open market may seek licenses for betting (virtual betting and horse racing betting) and certain types of online gambling (online casino games, online bingo for money, and online slot machines). Two types of licenses will exist: gambling licenses and gambling software licenses.

The New System in Brief

Measures of control of gambling availability under the proposal will include, for example, marketing controls, age controls, mandatory identity checks, and consumption controls.

Advertising for gambling will be allowed but only under strict conditions. Generally, all advertising will have to be moderate in extent, coverage, visibility, and repetition, and shall not be aimed at minors or other vulnerable individuals. Advertising will also be required to state the legal age to gamble and have details on where to find tools and support services for problem gamblers. Social media pages for license holders may advertise their games in a non-interactive fashion, but influencer marketing is prohibited. The law will also regulate sponsorships and outdoor advertisements.

The legal gambling age will remain at 18 years and older, and gambling will be mandatory to have identification checks.

In general, the Act prescribes a range of other responsibilities for licensees. These include suitability and compliance tests at the application phase, technical and behavior control of live gambling, testing of gambling systems, self-monitoring strategies by licensees, and reporting obligations. Licensees will also need to be transparent so that the players can view their money and transactions to help them assess their gambling activities. Licensees in certain cases must also impose restrictions on the playing time and the games played.

Penalties for violation can be fines and administrative sanctions. The licenses given can also be revoked as a final measure. These actions can also be criminalized under the Criminal Code of Finland. Instruments against illegal gambling activity by the enforcement authority will include the issuance of court orders to block the gambling or marketing in real-time and coercive collection of conditional fines. The authority can also order internet service providers to remove illegal content.

Who Can Apply and How

Natural and legal persons mentioned in Finland's Business Act and non-profit organizations can apply for a license. They are also obligated to meet the conditions of suitability and compliance under the Gambling Act apart from the usual requirements.

The fee for application will be fixed by ministerial regulation. In accordance with the Act on Criteria for Charges Payable to the State, the fee will be based on the average cost incurred in granting the service. The Act will also introduce an annual supervisory fee.

Gambling as well as software licenses will be issued for a maximum duration of 5 years at one time.

Looking Ahead

Parliament plans to consider the proposal this spring. If approved, gambling businesses will be in a position to begin applying for gambling licenses early next year, and licensed gambling operations will begin two years later. Applications for gambling software licenses will also open at the same time. Following a transition period, the obligation to use only licensed gambling software will take effect at the start of 2028.

Even though the new Act is embraced in the marketplaces, Finland is entering a new era of open internet gambling. This transition brings with it a series of questions without answers, and uncertainty for the gambling operators who are trying to adjust to the new law. As the gambling companies must succeed the Act's suitability and compliance tests before they can get licensed, they are encouraged to begin preparing for compliance already now.