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Finland is currently in the process of reforming its gambling regulatory framework and partially ending Veikkaus Oy’s exclusive right to organise online and land-based gambling in the country.
The Bigger Picture
On March 20, 2025, the Finnish government submitted the draft law of the new Gambling Act to parliament, with new licensees scheduled to begin their operations in the country at the start of 2027.
Preparations for the implementation of the new gambling system have already begun so that the National Police Board, which will act as the licensing authority during a transitional period, has the necessary systems in place and sufficient personnel to receive and process licence applications from the beginning of 2026.
The reform of the state’s regional administration has also been initiated, and aims to establish a new licensing and supervisory authority that would take over licensing and supervision of gambling activities from the beginning of 2027. A new dedicated regulatory authority will ensure enhanced supervision of the gambling sector, with sufficient resources allocated, thus securing better player protection as well as prevention of results manipulation and money laundering.
The stated aim of the reform is prevention of social, health and economic harm and direction of consumption towards licensed activities and away from the black market. Digitalisation has put its mark on the gambling culture, with the majority of players opting for online gambling activities, which led to illegal operators targeting the market.
As such, the current gambling policy has been declared unsuccessful due to both gambling-related problems affecting a significant number of people and loss of state revenue. It was found that illegal gambling operators not only do not pay licensing fees and taxes but also lack responsibility for the gambling-related problems caused by their offerings.
The fact that Finland is one of the few remaining European countries with a monopoly system for online gambling might have been another indirect reason that led to the reform of its gambling framework. A 2023 preliminary study on the monopoly system, commissioned by the Ministry of the Interior, concluded that Finland's monopoly system is at a “crossroads” and it must consider introducing a licensing system or more measures to prevent unlicensed online gambling. While assessing five benchmark countries, namely Sweden, Denmark, Norway, Netherlands and France, it outlined that these countries have significantly improved the channelling rate of online gambling after introduction of a licensing system.
Opportunities within the market
In a similar fashion to neighbouring Sweden, Finland chose to adopt a restrictive approach when it comes to reforming the country’s gambling monopoly, as Veikkaus Oy will retain the exclusive right to offer lottery-style games, scratchcards, land-based gambling machines and land-based casino games (Section 5, new Gambling Act). These types of gambling will be organised by a limited liability company controlled by the state under two separate exclusive licences granted for ten years (Sections 5 and 14, new Gambling Act).
Online casino games, online bingo, online slot machine games, land-based and online betting (fixed-odds betting, pari-mutuel betting and virtual betting), as well as horseracing would, however, be subject to local licensing (Section 6, new Gambling Act). A gambling licence could cover all or only a few types of gambling and several different gambling websites could be organised under one licence. An enticement for larger operators might be the possibility to operate in the market under more than one brand. A gambling licence can be granted for a maximum of five years when the new licensing system is established (Section 14).
The same restrictive approach was taken when it came to introducing gambling supplier licensing, as the only type of B2B licence that would be required to operate in Finland would be a gaming software licence for the manufacture, delivery, installation or adaptation of gaming software (Section 7, new Gambling Act). Gambling operators, however, might see this requirement as an impediment, as they would have to obtain such a licence even if they conduct these activities for their own operations.
It should be noted that a gaming software licence would not be required for supplying software that is only used in the ancillary functions of a gambling operator, such as performance analysis, marketing, customer relationship management, or the operator's financial, personnel and other administration.
Why should you care?
While the end of another European online gambling monopoly might be seen as an opportunity by some, it will definitely represent an impediment for others. Vixio’s director of data & insights, gambling, Daniel Stone, explains:
“As one of the last relics of Europe’s ‘dot.com’ era, Finland’s impending transition from ‘grey’ to fully licensed can be viewed in broadly the same vein as the regulated market launches seen in Sweden in 2019, the Netherlands in 2021 and, looking further afield, Ontario in 2022.
As in neighbouring Sweden, the incremental taxes, costs and frictions, both in an operational and regulatory sense, associated with the market’s regulation will inevitably erode the profitability of grey market incumbents who make the licensing leap.
Conversely, some of the same factors that have underpinned the broader Nordic region’s development into an online gambling stronghold — relatively high wealth and GDP per capita and an ingrained online gambling culture, both among the populace and wider business and start-up community — will help to stoke interest among operators and suppliers looking for new regulated market opportunities.
Assuming that Finland’s ‘re-regulated’ online gambling market will launch in July 2026, Vixio estimates that licensed online betting and gaming revenue, inclusive of current monopoly Veikkaus, will total €938m in 2027, settling above Denmark but below Sweden in terms of regulated online GGR per capita.”
Key actions to consider for market entry
- Financial planning
Although the cost of being licensed in Finland might prove challenging for smaller gambling businesses, it should not pose a barrier for larger companies, as the proposed gambling tax of 22 percent of gross gaming revenue (GGR) is similar to other tax rates in European countries (Chapter 5, Section 4, Draft law amending the Lottery Tax Act).
The annual supervision fee for a gambling operator ranges between €4,000 and €434,000, depending on the gambling operator’s GGR. The initial supervision fee for the first year of operation is set at €10,000, any difference in excess or deficiency by reference to the relevant threshold is adjusted accordingly at the end of the first year.
The annual supervision fee for a gaming software licensee is set at €1,500 (Section 70, new Gambling Act).
It should also be noted that additional application fees are to be regulated by means of secondary legislation.
You should review the company’s budget to anticipate any financial challenges and ensure the timely development of a strategy should mitigation be needed. An effective allocation of resources and implementation of cost control strategies will ensure financial stability upon market entry.
- Assessment of current and potential business partners
Mirroring other European jurisdictions in what is turning out to be a joint effort in combating illegal gambling, Finland has chosen to expressly prohibit gaming software licensees from supplying their services or products to unlicensed gambling operators. Likewise, starting from 2028, licensed gambling operators will only be able to use gaming software provided by licensed suppliers (Sections 33 and 106, new Gambling Act).
You should identify your business partners’ interest in applying for a licence in Finland and thoroughly assess their capabilities of obtaining one. Continuous monitoring of their status quo should be ensured so that any vulnerabilities in securing a licence are timely identified.
As a change of business partners might be required if they do not apply for a licence or do not meet the conditions to obtain one, your legal departments should also review existing contracts to determine the legal implications of an earlier termination or resolution.
To mitigate any risk, you should assess potential business partners and thoroughly evaluate their professional experience, financial background, core values and ethics.
- Review payment methods
In an effort to minimise problem gambling within the country, the new Gambling Act would prohibit the use of credit cards for gambling (Section 25, new Gambling Act). However, there are no other prohibited payment types for gambling and there is no specific gambling licence required for payment service providers. Licensees would thus be free to choose the payment channels and providers that best fit their needs, as long as anti-money laundering requirements are complied with.
Compliance and financial departments should review available payment methods for player deposits to ensure that the prohibition of gambling on credit is not eluded.
- Enhancement of compliance policies and controls
Businesses that apply for a licence will be assessed for reliability and suitability before being granted a licence in an effort to diminish any risk of abuse in the newly established gambling market.
Several bad actor clauses that apply not only to the legal entity but also to its board members, deputy members, executive management, persons directly or indirectly holding at least 25 percent of the shares of the limited liability company or the voting rights conferred by the shares, or, in the case of an entity other than a limited liability company, a corresponding ownership or control power might put a temporary end to the opportunity of obtaining a licence (Section 10, new Gambling Act).
These clauses include but are not limited to the imposition of a prohibition decision or penalty payment for organising or marketing gambling contrary to the Lotteries Act during the two years preceding the licence application, but after September 1, 2024, or a conviction to imprisonment or a community fine within the five years preceding the licence application, or to a fine within the three years preceding the application, for a crime that can be considered to show unsuitability for organising gambling or supplying gaming software (Section 10, new Gambling Act).
You should enhance internal transparency and communication by ensuring that clear reporting lines are established so that any non-compliance risks are escalated and addressed swiftly.
An internal audit should be performed to identify and assess any potential risks of non-compliance with the legislation currently in force. Compliance departments should conduct a gap analysis and review policies, procedures and controls to determine if enhancements are needed to existing policies, procedures and controls or new policies, procedures and controls created.
- Implementation of new policies, procedures and controls
Not many other jurisdictions have taken the bold approach of explicitly regulating the territorial scope of their legislation so that it does not conflict with the legislation of another state or region. Finland, however, followed Sweden’s example and has maintained the residency requirement currently applicable to Veikkaus Oy for its online gambling offerings under the Lotteries Act. As such, online gambling operators will only be allowed to register natural persons residing in Finland and will have to check their customers’ residency on a regular basis (Section 21, new Gambling Act). The new Gambling Act does not set any specific timeframes for these checks, but the explanations accompanying the draft underline that they should be frequent enough to ensure that the objective of the law is achieved and note the example of Veikaus Oy, which currently performs these checks every week.
Your compliance department should create clear policies and procedures, including internal controls concerning the residency requirement. Assess and implement the required technical means for conducting automatic checks in the population information system and appoint someone responsible for compliance oversight, or consider integrating this task into an existing role within the business.
- Ensure technical readiness
As a general rule, gaming systems must be located in Finland (Section 46, new Gambling Act). This provision should be interpreted as referring to physical servers or the hardware underlying the cloud service. Similar to the Swedish Gambling Act, two exceptions are regulated within the proposed law: when the business is licensed in another state and the supervisory authority therein has entered into an agreement with the Finnish gambling authority or the Finnish gambling authority is provided with remote access to the system. The second option, although more costly, might be more appealing for interested candidates as the signing of an agreement between regulatory authorities is likely to take time and, therefore, create uncertainty.
Should your servers not be located in Finland, conduct research on existing or planned agreements between regulatory authorities. Review the technical feasibility of your systems in order to implement any required changes that would allow remote access to a satisfying degree.
- Policy review and training of impacted staff
Finland did not choose to ban bonuses completely or, as with Sweden, limit their offer to the first occasion on which a player participates in a game. It has instead opted for an approach that focuses on maintaining customer relationships, rather than acquiring new ones. As such, the offer of bonuses would only be permitted for established customer relationships. The amount of a bonus will have to be moderate and cannot be exchanged directly for cash, and a maximum five-fold wagering requirement will also have to be put in place (Section 26, new Gambling Act).
Affiliate marketing, despite being considered by the industry as the most common way of acquiring new customers in the online environment, will be prohibited (Section 52(14), new Gambling Act).
Direct marketing, including marketing communications that are targeted directly at the recipient, for example by telephone, text message, email, post, or, for example, via a private message sent on social media, will require the customer’s explicit consent. Direct marketing by telephone, which includes marketing by telephone calls and not text messages, would be prohibited (Section 54, new Gambling Act).
You should review internal marketing policies and procedures to implement any required changes, as well as existing contracts with third-party marketing consultants. You should also ensure that training is carried out with the marketing department so that qualified personnel are aware of the restrictions and prohibitions regulated in the market.
What’s next?
It is to be expected that the secondary legislation further detailing the gambling legal framework will also shape the legal requirements to provide services in the market and impact the interest in applying for a licence. This will include regulations on player verification, player registration and gambling accounts, as well as application fees. Regulations clarifying the content of a licence application and the accompanying documentation, the procedure for payment of supervisory fees and technical requirements were already submitted to a public consultation at the beginning of June 2025.
However, as the new Gambling Act is currently pending before parliament, it may be subject to changes throughout the legislative process. This regulatory influencer is based upon the initial version of the draft law, as submitted to parliament.
