The Finnish administration has suggested overhauling the gambling monopoly.
A government investigation into Finland’s monopolistic system, compared to global benchmarks, concluded that preserving the current state is “not the optimal choice.”
The research presents two potential choices for Finnish legislators to contemplate. The first option, modeled after the Norwegian system, would grant regulatory bodies more authority to hinder consumers from accessing unauthorized foreign gambling platforms. This could involve new policies such as blocking orders, advertising prohibitions, and payment processing disruptions.
The second option, resembling what some of Finland’s neighboring nations have implemented, would establish a gambling regulatory licensing framework. According to the study, the introduction of this system would “substantially enhance” user guidance towards legal products.
“Conversely, it is challenging to precisely evaluate the potential effect of introducing a licensing system on the prevalence of gambling issues,” the study observes. “Increased competition following the implementation of a licensing system could, in theory, lead to an increase in overall gambling consumption, which could also escalate the harms associated with gambling.”
The study underscores that the reforms should be founded on the principles of consumer protection, responsible gambling, and social accountability.
Although the study contends that this is not the situation, research indicates that, based on the research literature, monopoly and licensing frameworks have “no impact” on the frequency of gambling-related harm or the overall amount of activity.
The report concludes by stating that any choice to implement a licensing system in Finland should be guided by the principle of minimizing gambling-related harm. Practically, this means restricting gambling marketing, establishing a well-funded gambling regulator, and “creating a comprehensive framework for the entire licensing system” to safeguard users from gambling-related harm.
These steps could involve mandatory identity verification for all participants, establishing a centralized self-exclusion mechanism, and “effective measures” to prevent the continued existence of unlicensed gambling from foreign sources.
Finland has already proposed a number of restrictive measures aimed at strengthening the operation of the monopoly system. Many of these relate to changes to the Lottery Act, which will take effect this year. However, the study points out that the issue with such measures is that they are technically easy to bypass.
Regulations concerning the prohibition of individuals engaging in wagering activities outside the established framework might necessitate the enactment of a statute prohibiting participation in gambling ventures conducted on online platforms not affiliated with Veikkaus. Alternatively, the government might require a more compelling justification for the payment regulations than the rationale previously provided during the amendment of the Lottery Act.
The Finnish Ministry of the Interior initiated an investigation on January 5th to explore alternative approaches to gambling within Finland. Despite numerous modifications to the Lottery Act over the past decade, the state-owned gambling enterprise, Veikkaus, has consistently maintained an exclusive monopoly on games of chance.
The investigation aims to assess the effectiveness of Finland’s existing system in relation to the objectives outlined in the Lottery Act. Additionally, it seeks to examine gambling practices in other nations, identifying both the advantages and disadvantages of various systems.
The study indicates that the proportion of individuals engaging in unlicensed gambling activities outside the Veikkaus framework has remained relatively constant over the past several years, hovering around 5% to 6% of the population.
Although the quantity of unlicensed gamblers within the nation is comparatively low, its financial effect is substantial, leading to an estimated annual cost of €500 million to €550 million, which constitutes roughly half of the total market.
For global comparison, the research examined the national gambling frameworks of five benchmark nations: Sweden, Denmark, Norway, the Netherlands, and France. Among these five countries, only Norway maintains a comparable monopolistic gambling market structure.
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