Antti Koivula: This is How the Gambling Industry in Finland Will Change

Antti Koivula, a leading iGaming lawyer and expert on the Finnish gambling market, recently gave an exclusive interview to Gambling Club. In this interview, he shares his insights and visions for the future regarding the dramatic changes taking place in the Finnish gambling market. One of the most notable developments is the Finnish government’s plan to end the monopoly of Veikkaus, the state-owned company currently responsible for all gambling activities in Finland. Koivula discusses the impact of these changes and what they mean for the market, players and international gambling operators.

End of Veikkaus’ monopoly

The Finnish government has announced plans to end the monopoly of Veikkaus, the state-owned company responsible for all gambling in Finland. This means that there will be a liberalized market where other providers may also be active.

Do you think this is a good development?

Absolutely! It’s a win-win-win-win. Customers, the state, the industry, and the current exclusive rights holder, Veikkaus, all benefit. Customers will enjoy a higher level of protection, the state will receive increased tax revenues, the industry will have new opportunities, and the state-owned gambling monopoly operator, Veikkaus, will no longer be at a disadvantage against online competitors.

How will it affect the market in Finland?

Most importantly, it will bring all legal offerings under the same legislative umbrella, creating a level playing field that encourages fair competition.  

Will they have an unfair position owning databases with existing players and lure them to the online offers?

Whether Veikkaus will be allowed to transfer their extensive database, which includes over 2.5 million customers and all associated data, to the new licensing system is indeed an interesting question. Under the legislative reform, Veikkaus’ operations will be divided between the remaining monopoly market and the new licensing system. Competition law dictates that in the new licensed market, Veikkaus should not gain any competitive advantage from its monopoly operations, as this would give it an unfair edge over the other license holders. From Veikkaus’ perspective, this will be one of the key factors determining their market position in the new era. This issue has been raised by several entities during the hearing phase, which closed on August 18, and it remains unresolved.

What opportunities do you see for international gambling operators in the new Finnish market?

The per capita gambling losses in Finland are among the highest in Europe, making the market lucrative. The Finnish gambling market is also expected to grow further following the introduction of the new licensing system, which makes it an attractive opportunity, assuming the legislature does not overregulate the market. 

Can the Finnish government ensure a level playing field for all operators in the new market?

Tackling illegal offerings is an issue in most jurisdictions, and Finland will be no different. Based on the recently published draft law, the new supervisory authority will have considerably more powers than currently, but it remains to be seen if that will be sufficient. Unfortunately, I have my doubts. 

From the perspective of fair competition, it would be problematic if Veikkaus were allowed to transfer their extensive database and all associated data to the licensing system. The same issue applies to some extent to their online competitors, many of whom have extensive databases of Finnish customers, though not to the same extent as Veikkaus. This issue has not yet been resolved, but I anticipate that the transfer of databases will be allowed, even though it does not promote fair competition. 

Licensing system

Finland is expected to introduce a licensing system for online casinos. 

This would allow foreign providers to legally offer their services to Finnish players, provided they comply with strict regulations and licensing conditions.

What are the biggest threats?

The biggest threat is low channelization through over-regulation. I am especially concerned that, according to the first draft law published in July, all bonuses, campaigns, and similar offers will be prohibited, as well as the use of third parties in marketing, effectively banning traditional affiliate sites. This benefits no one except the black market and undermines the primary goals of the legislative reform, which are a high channelization rate and effective prevention of gambling problems. 

The market is full of illegal online providers that service Finnish players. Will the Finnish government have enough tools to take action against those when the licenses are there?

The current Finnish legislation does not prohibit foreign gambling operators from accepting Finnish customers; it only prohibits gambling marketing directed at Finland by operators other than Veikkaus. The enforcement of this prohibition has not been very effective. In the future, the situation will change, and the legislature will have increased powers and enhanced tools to intervene in black market offerings, but it would be naive to believe that there will be no black market offerings after the reform. 

The expectation is that lots of foreign parties will enter the market. What’s your outtake on that?

Yes, there has been considerable interest in obtaining a gambling license in Finland once the new system is in place. Ultimately, it will depend on what kind of business opportunities the new system offers to operators, and the new legislation will be a major determining factor. 

Strict regulations

With the opening of the market, strict rules will also be introduced to protect players. This includes measures against gambling addiction, such as mandatory limits and strict verification processes.

How well equipped is the Finnish market for this? 

From an operator’s perspective, I don’t see any issues, as they have already faced similar rules in other jurisdictions. From the players’ perspective, there isn’t anything new either, since the current regulation is quite similar to the new one regarding these matters. From the perspective of prevention and treatment of problem gambling, the situation will unfortunately not change either—the services available for problem gamblers will likely continue to be ineffectively organized and lack proper funding. 

Will the government also offer help to prevent players getting into trouble?

When it comes to the prevention and treatment of problem gambling, the field is highly fragmented and inefficient. There are several organizations, many with sub-organizations, responsible for gambling harm prevention. Additionally, treatment is assigned to cities, municipalities, and the public healthcare system. The system is complex and highly inefficient, resulting in a high rate of problem gambling by international standards, with 4.2% of the population estimated to suffer from gambling problems. 

What are the biggest challenges that operators might face when adapting to the new strict regulations in the Finnish gambling market?

I do not anticipate any unique problems that operators have not already faced in other jurisdictions. However, a lack of possibilities for an open dialogue with the new licensing and supervisory authority could cause unnecessary problems. 

How do you see the role of technology in enforcing these new regulations, particularly in terms of player verification and monitoring gambling behavior?

Technology and AI already play a significant role in the field, and their importance is only expected to grow. They will have a central role in Finland as well. 

In your opinion, how effective do you think the new regulations will be in reducing the risks of gambling addiction?

The problem gambling rate is currently rising rapidly. The Finnish Institute for Health and Welfare has conducted nationwide studies on gambling problems every four years, and until 2019, the problem gambling rate was around 3%. By 2023, it had increased to 4.2%, and there is no reason to expect a decrease soon. This is a result of the current gambling policy, which has been based on a monopoly system. This trend is likely to continue in the near future, regardless of the system change. I do not anticipate that the new regulation will immediately stop the trend. That being said, I anticipate that gambling problems will not be as overlooked in the future as they have been until now and that the new system enables reduction of gambling problem rates in the long run. 

At present, gambling in Finland is overseen by the National Police Board but this system will be overhauled. The ministry of finance has been charged with establishing a new supervisory authority with a range of powers to regulate the market.

What challenges do you foresee in implementing this new regulatory structure?

Forming a new licensing and supervisory authority from scratch will be a significant effort involving numerous challenges. For example, where will they find over 100 qualified employees? How long will it take to get the agency up and running? How long will it take to establish good practices and avoid the issues faced in other jurisdictions? 

How will the licensing process for new operators be managed best?

I hope the new supervisory authority will benchmark a few model countries and establish good practices accordingly. There is no need to repeat the mistakes others have already made. 

What specific player protection measures should be implemented under the new regulatory framework?

I hope that the protection of minors will be taken more seriously under the new system than has been the case previously. For example, the supervision of age limits failed 83% of the time with Veikkaus slot machines, according to research commissioned by the National Police Board in 2020. According to the Finnish Institute for Health and Welfare, 25% of 15-year-old Finnish boys have gambled in 2024. These figures are not something to be proud of.