Finland outlines its plan to break up Veikkaus’ gambling monopoly

Finland outlines its plan to break up Veikkaus’ gambling monopoly

Finland outlines its plan to break up Veikkaus' gambling monopoly
Finland is finally fleshing out more details about its anticipated re-regulation of the gambling market in the country, which will essentially see Veikkaus, the state-owned company, lose its stranglehold over the market, tearing down its monopoly, and allowing foreign companies to compete locally. Finland sets the rules for gambling beyond Veikkaus’ monopoly The move is designed to potentially strengthen the country’s gambling market and create a more competitive environment that would allow players to freely choose from the best products. The Ministry of the Interior, which published the revised plan on Wednesday, also noted that it would expect higher revenue. Yet, Veikkaus is not going to lose its clout over the market, as it would remain the de facto monopolist in areas such as scratch cards and lottery games. The company would be losing ground when it comes to sports betting and online casino, however. The ministry has similarly outlined other plans it has for the re-regulated market, including advertising rules. One of the notable rules outlined by the ministry concerns social media influencers, who will be prohibited from advertising gambling products to their audiences. Already, the Finnish Police Board had intervened in several instances that had to do with influencers pushing such products onto their audiences. Yet, the law is also a sobering realization that consumer protection is failing in the country when it comes to matters of gambling. Although Veikkaus is the de facto monopoly in Finland, the company’s digital offering hardly accounts for all digital gambling that is taking place. Protecting consumers by acknowledging that Veikkaus is not the only game in town In fact, the draft of the planned re-regulation clearly states that Veikkaus only accounts for 50% of all digital gambling. This is because many Finnish players are actually looking for alternatives that are not regulated under state laws. By seeking to regulate the market and allow third parties in, Veikkaus is essentially trying to ensure that it drives higher channelization rates to the regulated market. It also does away with a hackneyed view that maintaining a state monopoly is the only way to ensure consumer protection, a claim that has been undermined by mounting evidence to the contrary. By liberalizing its market, Finland can invite outside companies in and hold them to higher consumer protection standards, while also raising additional revenue. It would also get the legal means to oust bad actors. However, Finland would do well to take note of what is happening in neighboring Sweden. The country’s chokehold on the gambling market has proven to be detrimental to channelization rates in the regulated market, with ham-fisted measures often ending up hurting the regulated market at the expense of a consistently expanding offshore market. Meanwhile, the Finnish draft bill of re-regulating the gambling industry also pitches a 22% tax on gambling companies’ profits, which should boost revenue to the state’s coffers. Winnings by players will be tax-free. The new measures should be introduced in 2026 with the first gambling companies to launch under the new licensing regime to arrive in 2027. Image credit: Unsplash.com

04 JUL 2024

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