FINLAND MARKET REPORT
Additionally, licensed operators will also face a tax of 22 percent on their Gross Gaming Revenue, which is in line with the current Swedish tax percentage. What to expect next The first version of the draft of the Finnish Gambling Act was published in July 2024, and followed with a round of consultation where all stakeholders had the opportunity to comment on the initial draft. A total of 81 statements were submitted by various organisations and communities regarding the government proposal. These statements came from a wide range of stakeholders, including governmental bodies, private sector organisations and associations, offering diverse expertise and perspectives. Based on feedback submitted during the consultation period, the Draft Act was amended and published on 1 November 2024. The second draft has been notified to the European Commission and Member States for review, to assess whether the reform could hinder the free movement of services. They are expected to provide feedback by February 2025. After their review, any necessary changes will be incorporated into the Draft Act, with the final proposal for the Finnish Gambling Act anticipated to be submitted to Parliament by February 2025. The Finnish Gambling Act is expected to take effect in January 2026. As the final amendments to the Draft Act have already been published, the final form of the regime is now becoming clear, and any new significant changes are unlikely. Conclusions We view the liberalisation of the Finnish online gambling market positively. State monopolies are ill-suited to the current, digitalised society, and it is increasingly challenging to meet the criteria to justify a monopoly under EU law. In our view, it was only a matter of time before market liberalisation
became necessary, as restricting fundamental EU freedoms — such as the freedom of establishment and the free movement of services — is difficult to justify on public health grounds, especially when there is a significant need for state revenue accrued from gambling. Aiming to attract operators and indirectly bring tax revenues to Finland, the Finnish online gambling market must be attractive to private operators. This requires some adaptation to market practices and acceptance of certain measures that have traditionally been viewed negatively in Finland. If the new regime is too strict on elements commonly used in online gambling, consumers may continue playing more appealing games on the grey market, directing their payments to unlicensed operators. This would ultimately divert income away from Finland and reduce the channelisation rate of licensed operators. For example, prohibition of affiliate marketing goes against common market practices and raises concerns as to whether it would negatively impact channelisation. If only unregulated operators are allowed on affiliate websites, it could undermine the effectiveness of the regulated market. Additionally, bonuses are standard features in online gambling. If, as proposed by the first draft, bonuses were not allowed in the regulated market, licensed operators might have faced challenges in retaining Finnish consumers on their regulated platforms. Due to the tight schedule for establishing the new regime, we are concerned that relevant comments provided during the consultation round may have been overlooked at this stage, potentially leaving the law incomplete in certain areas, such as match-fixing and affiliate marketing. As a result, this may lead to inadequate legislation that does not serve the purposes of Finnish igaming reform. Namely, creating a licensing system that encourages operators to seek a license in the Finnish market, while ensuring that the system minimises potential harm to players.
PIA EK Partner, Bird & Bird, Finland For information contact +358 9 622 6670 Pia.Ek@twobirds.com MARIA KARPATHAKIS Associate, Bird & Bird, Finland
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IMGL MAGAZINE | DECEMBER 2024
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