What Finland Can Learn on Online Gambling Liberalization

Finland is on the brink of a historic shift, moving away from its long-standing gambling monopoly to a licensed online market. But will it avoid the pitfalls faced by Sweden and Denmark? The Nordic region has been a case study in both the successes and challenges of liberalizing online gambling. With Denmark leading the way and Sweden encountering hurdles, Finland has the unique opportunity to craft a balanced and competitive market.

What Can Finland Learn from Its Nordic Neighbours on Liberalizing Online Gambling?

Key Takeaways:

✅ Denmark’s success: High channelization rates due to strong regulation and data-driven oversight.
✅ Sweden’s challenges: Overregulation led to black-market growth and reduced player channelization.
✅ Finland’s opportunity: Learn from both to create a fair and competitive market.

Denmark’s Success: A Model for High Channelization

Denmark was the first Nordic country to liberalize its online gambling market in 2012, introducing a licensing system that balanced competition and responsible gambling. Today, Denmark boasts a 90% channelization rate—the highest in the Nordics.

What made Denmark successful?

🔹 Data-Driven Regulation: The Danish regulator, Spillemyndigheden, collects and analyzes transactional data from all licensed operators. This allows for quick intervention when market issues arise.

🔹 Stable Regulatory Framework: Unlike Sweden, Denmark has largely maintained its original regulations. Instead of imposing strict advertising bans or deposit limits, the country focused on ensuring responsible gambling through education and monitoring.

🔹 Limited Market Disruption: During the COVID-19 pandemic, Sweden imposed harsh restrictions on online casinos, while Denmark relied on data to assess the situation before making policy changes. This approach prevented unnecessary interventions that could push players to unlicensed platforms.

Sweden’s Struggles: Overregulation and the Black Market

Sweden opened its online gambling market in 2019, but instead of fostering a competitive industry, overregulation has led to a growing black market.

Key challenges Sweden faces:

🔸 Aggressive Advertising Restrictions: Politicians have debated a full ban on gambling ads, limiting the ability of licensed operators to attract players.

🔸 Rising Taxes: In July 2023, Sweden increased its gambling tax from 18% to 22%, making the market less attractive for operators and driving players toward illegal sites.

🔸 Strict Deposit Limits & Affordability Checks: Unlike Denmark, Sweden introduced mandatory online casino deposit limits, reducing player trust in the licensed market.

As a result, Sweden’s channelization rate has dropped to 72%, far below the 90% target set by its regulator.

Finland’s Gamble: Avoiding the Mistakes of Its Neighbours

Finland is set to launch a licensed online gambling market in 2026, ending its state monopoly under Veikkaus. However, concerns remain about whether Finland will repeat Sweden’s mistakes or learn from Denmark’s success.

🔹 Monopoly vs. Open Market: One of the biggest concerns is whether Veikkaus will maintain an unfair competitive advantage, especially if it retains access to its 2.5 million customers after the market opens. Industry experts warn that this could make it difficult for new operators to compete.

🔹 Restrictive Marketing & Bonuses: Finland initially planned to ban affiliate marketing and casino bonuses, but after industry pushback, the government softened its stance. This change shows that Finland is willing to listen to stakeholders—something Sweden failed to do.

🔹 Black Market Risks: Excessive restrictions could drive players to unlicensed operators, a mistake Sweden made. Finland must ensure its licensed market remains attractive to prevent black-market growth.

A Balancing Act for Finland

Finland stands at a crossroads. With a well-executed regulatory framework, it could establish a sustainable and competitive gambling market, much like Denmark. However, if it leans too heavily on restrictions and fails to ensure fair competition, it risks following Sweden’s troubled path.

As Finland moves forward, it must:

✔ Ensure fair competition between Veikkaus and private operators.
✔ Maintain attractive incentives like bonuses and marketing freedom.
✔ Use data-driven regulation instead of knee-jerk restrictions.
✔ Keep tax rates competitive to discourage black-market play.

If Finland strikes the right balance, it could become a blueprint for responsible yet thriving online gambling regulation in the Nordics.