As you probably remember, Finland published a proposal for new gambling legislation at the beginning of July. After that, a round of opinions was started, during which approximately 130 opinions were received. The impact of statements and political decision-making on the bill was revealed on Friday, November 1, when Finland sent the new gambling legislation to the EU notification process.
The EU process takes three months if no member state requests an extension. If additional time is requested, the process will be four months. After that, the law will return to Finland, where any necessary changes will be made. The purpose is to submit the bill to the Finnish Parliament for consideration and decision during the spring of 2025. The goal has been for the parliament to approve the bill before the summer vacation 2025. However, it is more likely that the law will be approved during the fall of 2025.
The new gambling legislation, in which part of the gambling business will remain in the monopoly system and part will move to the multi-license system, will enter into force on January 1, 2026. After that, the licensing process is planned to start. The revised bill states that the law can come into effect in practice on July 1, 2026, at the earliest and January 1, 2027, at the latest. The practical schedule depends, above all, on the resourcing of the supervising authority, where the key issues are the technical readiness of the supervision and the schedule of the licensing process.
The law sent to the EU notification process can be considered very much the final gambling legislation coming to Finland. If the Finnish Parliament made significant changes to the law after the notification, the notification would no longer be valid. I believe it would have to be applied for again. Because of this, I think that the legal package presented now will be 98 - 99 percent final.
Monopoly and license-based products
In the future, the monopoly will be based on an exclusive license, which can only be granted to a company under the direct control of the Finnish state. An exclusive license is valid for ten years, but a gambling license is valid for only five years. Compared to summer's proposal, a significant change has been made to the exclusive license. According to the new proposal, there will be two exclusive licenses; one entitles the operation of lottery games and scratch cards and the other to physical casino operations, including slot machines located around Finland. Exclusive licenses can be granted to the same company, and it is assumed that, at least initially, they will be given to the state-owned, current monopoly company, Veikkaus.
According to my analysis, the reason for the two exclusive licenses is the state's plans to give up at least part of its ownership in Veikkaus. The long-term plans seem to incorporate the companies that operate different gambling products separately. Based on this, the government may plan to sell, for example, the company that runs casino operations or part of it.
A gambling license can be granted for fixed-odds and pool-based betting, virtual betting, digital casino games, digital bingo, and digital slot machine games. In terms of betting, a license can be granted for betting games implemented both via digital and physical sales channels. Fixed-odds and pool-based betting could also include horse betting. Therefore, the change to the summer proposal is the transfer of pool-based horse betting from a monopoly to a multi-license system. Finland has reached a solution where one gambling license can be used to operate all gambling areas included in the license, i.e., there will be no separate licenses for product areas.
Some changes to operation restrictions and requirements
The licensed company must enable the player to view the funds on the player's betting account, transfers of funds, gambling transactions, and restrictions on gambling. The information should be provided for at least the past year. The new thing is the licensed company's obligation to offer the player a tool that would allow the player to evaluate his gaming behavior monthly and yearly.
Two points in the July bill aroused much discussion and criticism, at least among gambling companies. Another was marketing and related bonus practices. Marketing must be carried out or produced by the licensee itself, and the basis of marketing distribution should always be a contractual relationship with the licensee. In addition, marketing must be moderate in amount, scope, visibility, and frequency.
Marketing has been refined so that marketing in printed and electronic media also applies to digital publications corresponding to printed media. The regulation on sponsorship has been amended by adding the license holder's obligation to ensure that the sponsorship does not highlight the licensee's gambling products. Only the gambling company's brand can be highlighted in the sponsorship.
Gambling companies may not give players money for gambling or offer money games for free or at a reduced price. However, they will have the opportunity to offer bonus money to their existing customers under certain conditions. For example, bonuses, loyalty programs, and other similar benefits and features that encourage customers to play more or are rewarded for the amount of play or deposits are prohibited.
According to the definition, giving moderate bonus money during an established customer relationship would be allowed equally to the license-holder's customers. Getting bonus money should not be based on the time spent gambling or be related to the amount of money spent on games. Based on the abovementioned description, I cannot immediately tell what kind of bonus arrangements will be possible in practice. Instead, the maximum wagering requirement for bonus money has been clearly established. Circulation can be a maximum of five times.
Another marketing point that has attracted criticism is the use of affiliates. Based on the new bill, the use of affiliates will be prohibited. The bill states that only marketing on the license company's own website and social media accounts is allowed. In addition, the licensed company must ensure that third parties do not have the opportunity to distribute or resend publications. The legal text also clearly states that it is forbidden to use affiliates in gambling marketing, which is based on directing online traffic to gambling websites.
Based on the comments from the opinion round, proposals on payment and IP blocking have been removed from the bill. However, the bill states that after the law enters into force, the operation of the gambling market will be monitored, and the need for payment and IP blocking will be assessed again.
Betting activities are somewhat restricted. Betting may not be organized on state elections (e.g., parliamentary elections) or economic variables (e.g., stock exchange rates). As far as I understand, lottery betting is not possible either. In addition, the bill prohibits betting, the object of which would be a penalty or punishment following a violation of the rules of a competition, tournament, or sport. In practice, this means that the object of betting must not be, for example, a red or yellow card or penalty.
There has also been discussion about whether the current monopoly company can transfer its current customers to the new license company. The bill states that the customer base accumulated under Veikkaus' monopoly operation can be used in the gambling operations of a gambling license holder operating on a competitive market only to the extent that it is formed by players of gambling games covered by the gambling license.
There is no actual cooling-off period in the bill. Still, the bill states that a license could not be granted if the applicant had, during the two years before the assessment, but nevertheless after September 1, 2024, been issued a prohibition order or imposed a sanction fee for the implementation or marketing of gambling in violation of the current Lotteries Act. I consider this a cooling-off principle, although issuing a prohibition order or sanction fee is reasonably heavy and time-consuming, and the current regulator does not have many resources.
B2B license comes into effect in 2028
As stated in the July bill, the licensee must use the gambling software supplied by the holders of the game software license (B2B license). A gambling software license holder may not deliver gambling software to an operator who operates or markets gambling in violation of the law without a Finnish license. According to current information, B2B licenses can be applied for at the beginning of 2027, and the requirement to use a B2B license will come into effect from the beginning of 2028.
Examples of software subject to a B2B license include betting software, random number generators, programs used to present gambling results containing gambling data, gambling streaming solutions used in live casino operations, and gambling monitoring software.
Conclusion
The bill defines hundreds of other issues besides the ones mentioned above, which are impossible to list in this kind of blog. We will be happy to help you understand even more details, but some are still unclear.
As an overall assessment, I would say that the bill has gone in a more positive direction since July if I consider the opportunities for gambling companies to conduct business in Finland. However, there are a few big disappointments in the proposal from the point of view of increasing the system's channeling ability. The definition of allowed bonuses is still unclear, but it seems to limit the use of bonuses a lot. Another even bigger mistake is the ban on using affiliates. In the new gambling system, this partner network commonly used by gambling companies remains a tool for gambling companies operating entirely without a license. I believe that, especially in online casino operations, the channelization rate of the Finnish gambling system will, therefore, be much lower than expected.
Jari Vähänen
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