Finland’s New Gambling Bill to End Veikkaus Monopoly by 2027

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The Finnish Ministry of the Interior has introduced a draft government proposal to reform the country’s gambling system. This proposal, which aligns with the Government Programme, aims to dismantle Veikkaus Oy’s current monopoly on betting and online casino games and open these markets to competition through a licensing model. The consultation period for this draft legislation ends on August 18, 2024.

Key Changes and Objectives

Under the new proposal, Veikkaus Oy will no longer hold exclusive rights to arrange betting and online slot machine games and casino games. These areas will be opened to competition via a licensing system managed by the Finnish Supervisory Agency. The goal is to reduce gambling-related harm and channel demand toward a regulated gambling system.

Currently, Veikkaus Oy maintains a monopoly over gambling games in Finland, but a substantial portion of online gambling occurs outside this system, involving enterprises not regulated or supervised by national authorities. The new legislation seeks to regulate these activities, ensuring better oversight and consumer protection.

Licensing and Supervision

The proposed act outlines the provisions for licensed gambling and its supervision. To increase regulation and minimize gambling-related harm, enterprises can apply for licenses to operate gambling games in Finland. There will be two types of licenses: exclusive licenses and gambling game licenses. Additionally, the provision of gambling game software will require a specific software license.

Licensing will require payment of an annual supervision fee to the regulatory authority. Lotteries, pools, totalisator betting, physical slot machines, and casino games will remain under exclusive licenses, maintaining Veikkaus’ monopoly over these areas. However, the monopoly and competitive market activities will be separated into different entities within the same group.

The government will decide on the annual compensation Veikkaus pays the state for its exclusive license. The proposed legislation also grants the state owner more flexibility regarding future decisions about Veikkaus Oy’s ownership, including reducing state ownership if deemed beneficial for shareholder value.

Marketing and Player Protection

The draft legislation includes stringent provisions on the marketing and sponsorship of gambling games. Licensed gambling enterprises can advertise within specific restrictions, ensuring moderate volume, scope, visibility, and frequency of marketing efforts. Prohibited marketing tools and practices include collaboration with social media influencers on their accounts and targeting minors or vulnerable persons.

A centralized register for self-imposed gambling bans will be introduced, allowing players to exclude themselves from any gambling games any license holder offers. The act will also govern the registration of gamblers, verification of their identity and residence, age limits for gambling, and the use of gambling accounts.

New Supervisory Agency

A new Finnish Supervisory Agency, operating under the Ministry of Finance, will replace the National Police Board as the regulatory authority. This agency will have extensive powers to regulate the market, including imposing administrative sanctions, prohibiting unlawful activities, rescinding licenses, and conducting test purchases. It will also oversee compliance with anti-money laundering and terrorist financing legislation.

The agency will use network barring and payment blocking to prevent unauthorized gambling and steer demand toward licensed operators. Additionally, the Ministry of Social Affairs and Health, through the Finnish Institute for Health and Welfare, will monitor, study, and assess gambling-related harms.

Implementation Timeline

The government plans a phased implementation of the new system:

  • August 18, 2024: End of the consultation period.
  • Spring 2025: Submission of the government proposal to Parliament.
  • Early 2026: Opening of license applications for operators.
  • End of 2026: Veikkaus’ monopoly on sports betting and online casino games ends, with the company split into separate entities.
  • Early 2027: Suppliers can apply for software licenses, and licensed gambling activities commence.
  • 2028: Requirement for operators to use only locally licensed software providers.

The draft legislation represents a significant shift in Finland’s approach to gambling, aiming to create a more regulated and competitive market. Feedback from industry stakeholders and government departments is being sought to refine the proposals before final submission to Parliament.

Source:

Draft legislation on new gambling system submitted for consultation, intermin.fi, July 3, 2024.

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