FINLAND
sooner rather than later, Finland will have to go through a system change anyway. As that is the case, from Veikkaus’ perspective, the only real question is whether they will have a better or a worse starting position for the competitive market. The third reason behind the upcoming change is tied indirectly to Veikkaus’ decreasing revenue. Gambling proceeds have been designated for certain good causes long before the creation of the new Veikkaus. The beneficiaries consist of several thousand organizations mainly from the sports, healthcare, and culture sectors. Until 2017, these beneficiaries enjoyed ever-increasing and secured funding. Consequently, they were the greatest lobbying force for the monopoly system and Veikkaus itself. In 2020, when the COVID-19 pandemic had a significant impact on Veikkaus, the beneficiaries managed to pressure the government to compensate them for the decreased funding. Now a new law has entered into force, severing the link between Veikkaus and the beneficiaries as starting January 1, 2024, Veikkaus’ proceeds will be directed to the normal state budget without being ear- marked for the beneficiaries. As a consequence the beneficiaries’ incentive to lobby on behalf of the monopoly system is eliminated. Veikkaus convinced the politicians Veikkaus’ change of heart convinced the politicians, and opinions quickly started to shift towards introducing a partial licensing system. On September 9, 2022, a survey was published, according to which only one smaller parliamentary party, the Christian Democrats (three percent support), was opposed to the idea of giving up the monopoly system, while the rest either supported the change or were open to considering the options for the monopoly system. The National Coalition Party (“NCP”), back then an opposition party and the biggest party in Finland according to polls, came out first. At the end of September 2022, the NCP stated that Finland should immediately start preparing to shift to a partial licensing system. This caused the other parties to go silent for a few months since the parliamentary elections were only six months away, and repeating NCP’s statement did not make sense politically. At the end of December 2022, first the Social Democrats, at the time the party of the prime minister and the second biggest party in the polls, stated that they recognized the need for the change. The following day, the Minister for European Affairs and Ownership Steering stated that the government had a unanimous view on the abolition of the Veikkaus monopoly on digital games. Practically this meant
that a wide political consensus had been reached that a partial licensing system, including online casino games and betting, will be the direction in which Finland must head in the future.
The process towards partial licensing system has begun On January 5, 2023 the Ministry of the Interior initiated a study on the alternatives for the gambling monopoly system. The project was set a deadline of 15 April, so that the results would be available for the governmental negotiations that follow the parliamentary elections of April 2, 2023. It is worth noting that initiation of the study directly contradicted the government program in place at the time, according to which the corner stone of Finnish gambling policy is strengthening the monopoly regime. It was also a historical study, as never before had Finland previously felt the need to consider alternatives to the monopoly system. The NCP won the parliamentary elections of April 2, 2023, gaining 48 MPs out of 200, which means they will be the ones to initiate the governmental negotiations with the other parties to find a coalition to form a majority government. If and when they are successful, they will also get the prime minister’s seat. With the NCP in charge, the likelihood of Finland creating a balanced licensing system that is not overly strict and allows business to flourish, is the greatest. They are also the ones who are pushing for the fastest change. After the new government has been formed and the government program drafted, the real work begins. Another more in-depth study is likely to be initiated during the next fall on the particular features of the licensing system. The draft government proposal, hearing phase, and European Commission standstill period will follow soon after. Then the actual government proposal will be drafted, and it will go through several stages in parliament before entering into force. As Veikkaus is pushing for a fast change and there is already widespread political agreement on the necessity of implementing a partial licensing system, it is expected that the process will be fast-tracked. Realistically, Finland could have a licensing system in place as early as the beginning of 2025. Whether or not that timeframe is achieved, it would be surprising if it were delayed beyond 2026.
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IMGL MAGAZINE | APRIL 2023
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