Gaming / iGaming / Gambling Finland

Reproduced with permission from Law Business Research Ltd. This article was first published in Lexology GTDT – Gaming 2023. For further information, please visit: https://www.lexology.com/gtdt. Quick reference guide enabling side-by-side comparison of local insights into land-based and remote gambling and quasi-gambling activities, including legal definition; age restrictions; penalties; social and non-profit gambling; regulatory authorities; anti-money-laundering regulations; establishment, director, officer and owner licensing; casino development; passive/institutional ownership; responsible gambling; taxes; cross-border and internet gambling; patents; trademarks; advertising; supplier licensing and registration; wage and hour and collective labour issues; change of control and bankruptcy considerations; recent litigation; and recent trends.

GAMING Finland 2023

This article was originally published in Lexology GTDT – Gaming 2023.

https://www.lexology.com/gtdt/tool/workareas/report/gaming/chapter/finland

CONTRIBUTORS
Minna Ripatti
Founding Partner and Attorney at Law
[email protected]

Antti Koivula
Legal Advisor
[email protected]

Heikki Koivula
Senior iGaming Compliance Advisor
[email protected]

Legal definition of ‘gambling’

What are the legal elements required for an activity to be regarded as gambling?

Finland Legal Gaming Attorneys at Law 10 May 2023.

According to the Lotteries Act (1047/2001), a lottery is an activity in which participants may win a prize of monetary value based in full or in part on chance and in which there is a charge for participation. Gambling is defined as a subtype of lottery in which players can win money. If a game falls within the definition of a lottery, the state-owned gambling operator, Veikkaus, has the exclusive right to provide and market the game.

The definition of ‘lottery’ is extremely broad and includes almost all types of games of chance with participation fees and prizes, regardless of whether the games are offered offline or online. There are a very limited number of exceptions, such as sports competitions, arts competitions, chess, darts and beauty pageants.

Remote activity

With respect to remote or other cross-border activity, where is the wager deemed to take place?

Finland Legal Gaming Attorneys at Law 10 May 2023.

The scope of the Lotteries Act covers foreign gambling operators to the extent that their services are available in Finnish territory; therefore, the Act will apply to foreign gambling operators that accept players from Finland.

Age restrictions

What is the minimum age for participating in lawful gambling?

Finland Legal Gaming Attorneys at Law 10 May 2023.

The minimum age for participating in lawful gambling in Finland is 18 years.

Penalties

What are the penalties for offering unlawful gambling?

Finland Legal Gaming Attorneys at Law 10 May 2023.

The unlawful offering of gambling services in Finland has been criminalised and is punishable under the Criminal Code by up to two years’ imprisonment. In practice, in most cases, the gambling would need to physically take place in Finland for it to qualify as a punishable unlawful gambling offering. For example, keeping a cash slot machine in Finland is illegal for anyone except the state-owned gambling monopoly operator, as is arranging a cash poker game.

Does the law penalise the gambler directly for participating in unlawful gambling?

Finland Legal Gaming Attorneys at Law 10 May 2023.

Finnish law does not penalise players for participating in unlawful gambling.

Social and non-profit gambling

Are there exceptions for social gambling, or charitable or non-profit gambling?

Finland Legal Gaming Attorneys at Law 10 May 2023.

Gambling (ie, a game of chance with a participation fee and monetary prizes) falls under the exclusive rights of the state-owned gambling operator Veikkaus. However, an exception exists in regard to arranging lotteries (ie, a game of chance with a participation fee and prizes of monetary value but not money).

It is possible for a registered association, an independent foundation or an organisation that has a non-profit purpose and whose registered office is in Finland to apply for an authorisation to run a lottery. A licence may be granted if the lottery is run to collect funds to promote a non-profit activity, the running of the lottery is not manifestly inappropriate in respect of the public interest, and the licensing authority has no reasonable grounds to suspect that the applicant will act in violation of the provisions on running lotteries.

The licence may include conditions concerning the tickets, the ticket price, the sale of tickets, the draw, claiming prizes and other aspects regarding running a lottery. It may also include conditions on the purpose of the proceeds and on monitoring the running of a lottery.

A licence granted for running a lottery may be revoked if the licence holder has seriously violated a legally significant law for the running of lotteries or the licence conditions, or if the licence holder no longer meets the conditions for obtaining a licence.

Regulatory authorities

What entity regulates land-based and remote gambling, and what are the regulator’s powers?

Finland Legal Gaming Attorneys at Law 10 May 2023.

Finnish law does not differentiate between the supervision of land-based and remote gambling. The National Police Board (NPB) is the main supervisory authority, and the local police departments complement the NPB’s authority.

The NPB is responsible for the national monitoring of lotteries, including gambling. It can issue statements and instructions on the running and monitoring of lotteries and can impose sanctions defined in the Lotteries Act to infringers, namely prohibition orders, conditional fines, administrative penalties and addition of the gambling operators to the payment blocking list. The NPB may also submit an infringement to criminal procedure.

A prohibition order is, in essence, a cease-and-desist order with which the NPB prohibits the continuation of the illegal practice. Usually, a conditional fine is attached to a prohibition order, and if the prohibited action continues, the NPB may initiate the procedure to enforce a fine. Since the latest legislative reform entered into force on 1 January 2022, an administrative penalty is considered an alternative to a conditional fine. Administrative penalties require intention, they may be imposed against legal entities and private individuals alike, and they are bigger. An administrative penalty may be a maximum of 4 per cent of turnover for legal entities, with a minimum penalty of €10,000 and a maximum penalty of €5 million. When a prohibition order is imposed against a gambling operator, it will automatically be added to the payment blocking list for the duration of the prohibition order. Payment blocking itself includes, categorically, all payments from mainland Finland to operators who are on the payment blocking list.

Police departments monitor the lotteries run in their own areas.

The Advisory Board on Gambling, appointed by the government, operates under the Ministry of the Interior in monitoring the achievement of gambling policy goals and development needs.

Anti-money-laundering regulations

Are gambling licensees considered financial institutions for purposes of anti-money-laundering and similar financial services regulatory requirements or are they otherwise subject to such requirements?

Finland Legal Gaming Attorneys at Law 10 May 2023.

This question is not applicable since Finland has a gambling monopoly, and licences for running lotteries that do not have monetary prizes are only available for non-profit organisations.

Land-based gambling

Types

What types of land-based gambling are permitted in your jurisdiction, and is gambling regulated at a national or subnational level?

Finland Legal Gaming Attorneys at Law 10 May 2023.

Finland has a gambling monopoly in place, and the state-owned gambling operator Veikkaus has the exclusive right to arrange and market all forms of gambling. Veikkaus has two casinos in Finland, one in Helsinki and another one in Tampere. In addition, Veikkaus has 85 gaming rooms, nearly 5000 points of sale and approximately 10,000 slot machines in everyday environments such as grocery stores, petrol stations, restaurants and cafeterias.

Establishment licensing

Please describe the licensing criteria and procedures to operate land-based gambling of each type or classification. Does your jurisdiction limit the number of available licences?

Finland Legal Gaming Attorneys at Law 10 May 2023.

This question is not applicable since Finland has a gambling monopoly in place, and the state-owned gambling operator Veikkaus has the exclusive right to arrange and market all forms of gambling.

Director, officer and owner licensing

Must individual directors, officers or owners of licensees also be licensed or reviewed for suitability?

Finland Legal Gaming Attorneys at Law 10 May 2023.

This question is not applicable since Finland has a gambling monopoly in place, and the state-owned gambling operator Veikkaus has the exclusive right to arrange and market all forms of gambling.

Location

May a gambling location be part of a resort, restaurant or other multi-purpose location? What limitations apply?

Finland Legal Gaming Attorneys at Law 10 May 2023.

This question is not applicable since Finland has a gambling monopoly in place, and the state-owned gambling operator Veikkaus has the exclusive right to arrange and market all forms of gambling.

Casino development

What considerations arise in developing a casino resort project that are not typical to other resort development?

Finland Legal Gaming Attorneys at Law 10 May 2023.

This question is not applicable since Finland has a gambling monopoly in place, and the state-owned gambling operator Veikkaus has the exclusive right to arrange and market all forms of gambling.

Passive/institutional ownership

Are there provisions for passive or institutional ownership that allow for exemption or modification of licensing requirements?

Finland Legal Gaming Attorneys at Law 10 May 2023.

This question is not applicable since Finland has a gambling monopoly in place, and the state-owned gambling operator Veikkaus has the exclusive right to arrange and market all forms of gambling.

Responsible gambling

What responsible gambling obligations apply to licensees?

Finland Legal Gaming Attorneys at Law 10 May 2023.

This question is not applicable since Finland has a gambling monopoly in place, and the state-owned gambling operator Veikkaus has the exclusive right to arrange and market all forms of gambling.

Taxes

What type of tax and what tax rate applies to each form of lawful land-based gambling activity?

Finland Legal Gaming Attorneys at Law 10 May 2023.

Regarding tax, Finnish law does not differentiate between land-based gambling and remote gambling. The gambling tax rate has been temporarily lowered, and it is 5 per cent for 2023. From 2024 onwards, the tax rate will return to 12 per cent. The tax rate is calculated from the proceeds.
Regarding lotteries, (ie, a game of chance with a participation fee and prizes of monetary value but not money), in which non-profit entities may acquire licences under certain criteria, the tax rate is:

• 1.5 per cent of the proceeds in non-monetary lotteries, guessing games and non-monetary prize machine games;
• 5 per cent of the combined value of the prizes in bingo games; and
• 30 per cent of the combined value of the prizes in other games.

Remote gambling

Types

Is remote gambling permitted and, if so, what types?

Finland Legal Gaming Attorneys at Law 10 May 2023.

Finland has a gambling monopoly in place, and the state-owned gambling operator Veikkaus has the exclusive right to arrange and market all forms of gambling. However, it is not prohibited for foreign gambling operators to accept customers from Finland or to offer them gambling products. Additionally, it is not prohibited for Finnish customers to use the services of foreign gambling operators. In that sense, no form of remote gambling is prohibited.

Licensing

What are the criteria for obtaining a licence to operate remote gambling?

Finland Legal Gaming Attorneys at Law 10 May 2023.

The question is not applicable since Finland has a gambling monopoly in place, and the state-owned gambling operator Veikkaus has the exclusive right to arrange and market all forms of gambling.

How do the licensing criteria for remote gambling operators differ from those applicable to land-based operators?

Finland Legal Gaming Attorneys at Law 10 May 2023.

The question is not applicable since Finland has a gambling monopoly in place, and the state-owned gambling operator Veikkaus has the exclusive right to arrange and market all forms of gambling.

Cross-border gambling

May operators located in other countries offer internet gambling to consumers in your jurisdiction without obtaining a licence there?

Finland Legal Gaming Attorneys at Law 10 May 2023.

Finland has a gambling monopoly in place, and the state-owned gambling operator Veikkaus has the exclusive right to arrange and market all forms of gambling. At the same time, it is not prohibited for foreign gambling operators to accept customers from Finland or to offer them gambling products. Additionally, it is not prohibited for Finnish customers to use the services of foreign gambling operators. However, pursuant to Finnish law, foreign operators are prohibited from conducting marketing activities in Finland or targeting Finnish individuals in their marketing campaigns or marketing measures.

May operators licensed in your jurisdiction offer internet gambling to consumers in other countries?

Finland Legal Gaming Attorneys at Law 10 May 2023.

Finland has a gambling monopoly in place, and the state-owned gambling operator Veikkaus, which has the exclusive right to arrange and market all forms of gambling, is only allowed to provide its online services for customers permanently residing in Finland.

Taxes

What tax rate applies to each form of remote gambling?

Finland Legal Gaming Attorneys at Law 10 May 2023.

Intellectual property

Patents

Are gambling games – land-based or remote – patentable in your jurisdiction?

Finland Legal Gaming Attorneys at Law 10 May 2023.

Certain parts and methods for organising games may be patentable. This depends on the product in question.

Trademarks

Are there limitations on how brands, logos or other types of marks may be used in promoting gambling games?

Finland Legal Gaming Attorneys at Law 10 May 2023.

Finland has a gambling monopoly in place, and the state-owned gambling operator Veikkaus has the exclusive right to arrange and market all forms of gambling. Other gambling operators are prohibited from conducting marketing activities in Finland or targeting Finnish individuals in their marketing campaigns or marketing measures.

Veikkaus may promote gambling and the company if the marketing is moderate in quantity, scope, visibility and frequency, and the marketing is necessary to direct the demand to gambling activities carried out under the Lotteries Act and to gambling that causes less economic, social and health damage. It is prohibited to promote gambling that causes economic, social and health-related harm. The Lotteries Act also includes a number of other marketing restrictions that apply to Veikkaus, but there is nothing trademark specific.

Advertising

Restrictions

What types of restrictions apply to advertising gambling games?

Finland Legal Gaming Attorneys at Law 10 May 2023.

Any operator other than state-owned gambling operator Veikkaus is restricted from conducting marketing activities in Finland or targeting Finnish individuals in marketing campaigns or marketing measures. Veikkaus may promote gambling and the company if the marketing is moderate in quantity, scope, visibility and frequency, and the marketing is necessary to direct the demand to gambling activities carried out under the Lotteries Act and to gambling that causes less economic, social and health-related harm.

It is prohibited to promote gambling that causes economic, social and health-related harm by:

• glorifying gambling by presenting it as desirable or excessively positive or by inciting gambling;
• portraying excessive gambling in a positive light, or non-gambling or moderate gambling in a negative light;
• making gambling commonplace or equating gambling with everyday life or with a person’s daily routines or daily or habitual consumption such as buying food or clothes, or by presenting gambling as a necessary or harmless pastime;
• presenting gambling as a solution to a person’s financial problems, a means of improving a person’s financial situation or challenges to a person’s life management, or as an alternative to work;
• describing gambling as a way to promote a person’s social success or acceptance;
• giving a misleading or unrealistic impression of the potential for winning at gambling, by overemphasising the potential for high winnings or by portraying gambling as economically or socially risk-free or risk-free with regard to health;
• exploiting ignorance, inexperience or gullibility about gambling;
• offering gambling money or offering gambling for free or at a reduced price, or in combination with other offers;
• offering for sale a gambling product in connection with the purchase of another gambling product or other commodity, or in connection with the collection of gambling winnings;
• offering, in connection with a purchase of a gambling product, a random benefit other than the possibility of winning from gambling;
• urging the funding of a public benefit activity through gambling; or
• taking any other actions similar to those above.

Marketing must not be directed at minors or otherwise vulnerable persons. It also must not involve minors. Gambling must not be marketed in television, radio, cinema, public performances or publications aimed at minors or in media services aimed at minors or that specifically appeal to minors and young persons. Marketing must not be directed at a player who has banned him or herself from all gambling. If a player has placed a game-specific ban, he or she may only be targeted by marketing for other gambling games.

Electronic money lotteries, electronic instant lottery games, slot machines and casino games may not be marketed elsewhere than in the specific gambling establishments and casinos in which they are placed. Combination games that have been identified as presenting a particular risk of gambling harm at the time of the adoption of the game rules may not be marketed outside specialised gaming rooms, casinos and racetracks in which the games or their points of sale are located. It is prohibited to market the places in which these games are placed or sold, but it is permissible to provide certain information on them.

Suppliers

Licensing

What types of suppliers to gambling operators require licences?

Finland Legal Gaming Attorneys at Law 10 May 2023.

As Finland has a gambling monopoly, licences are not available.

Registration

If licensing is not required, is there a registration or other process suppliers are subject to, and what triggers that process?

Finland Legal Gaming Attorneys at Law 10 May 2023.

Finland has a gambling monopoly in place, and the requirements that suppliers must meet when cooperating with state-owned Veikkaus are not publicly disclosed.

Labour and employment

Wage and hour rules

Are there particular rules governing hours and wage treatment for casino employees?

Finland Legal Gaming Attorneys at Law 10 May 2023.

Casino employees are subject to regular employment laws.

Collective labour

Must casino employees be members of labour unions or similar organisations?

Finland Legal Gaming Attorneys at Law 10 May 2023.

Casino employees are not required to belong to labour unions or similar organisations.

Acquisitions and changes of control

Change of control

How are licensee changes of control, and substantial changes in shareholdings of licensees, addressed?

Finland Legal Gaming Attorneys at Law 10 May 2023.

As Finland has a gambling monopoly, licences are not available.

Bankruptcy

How are gambling licences treated in bankruptcy?

Finland Legal Gaming Attorneys at Law 10 May 2023.

As Finland has a gambling monopoly, licences are not available.

Quasi-gambling

Regulation

How are forms of ‘quasi-gambling’ regulated? Are any treated as ‘gambling’, and what triggers such treatment?

Finland Legal Gaming Attorneys at Law 10 May 2023.

Most forms of traditional quasi-gambling fall within the definition of gambling and under Veikkaus exclusive rights. According to the Lotteries Act, a lottery is an activity in which participants may win a prize of monetary value based in full or in part on chance and in which there is a charge for participation. Gambling is defined as a sub-type of lottery in which players can win money. If a game falls within the definition of a lottery, the state-owned gambling operator Veikkaus has the exclusive right to provide and market the game.

Licensing

Does your jurisdiction license quasi-gambling operators?

Finland Legal Gaming Attorneys at Law 10 May 2023.

As Finland has a gambling monopoly, licences are not available to any operators, including quasi-gambling operators. The definition of gambling is extremely broad, and most forms of quasi-gambling fall under the scope of Veikkaus’s exclusive rights.

Other restrictions

Does your jurisdiction impose other restrictions on the conduct of quasi-gambling activity, including restrictions on advertising, age of participation, limitations on prizes, etc?

Finland Legal Gaming Attorneys at Law 10 May 2023.

Finland has a gambling monopoly in place, and the state-owned gambling operator Veikkaus has the exclusive right to arrange and market all forms of gambling. The definition of gambling is extremely broad, and most forms of quasi-gambling fall under the scope of Veikkaus’s exclusive rights, under which the same limitations apply as those for traditional gambling.

Litigation

Recent cases

What, if any, significant litigation involving the gambling or quasi-gambling sectors has your jurisdiction seen in recent years?

Finland Legal Gaming Attorneys at Law 10 May 2023.

In general, the number of recently litigated gambling-related court cases, both civil and criminal, has been low. Most of the cases concern illegal gambling advertising, and the decisions underline the fact that the applicability of the Lotteries Act is extremely broad. For example, even a fantasy sports game and an ice fishing competition were considered to be lotteries within the meaning of the Lotteries Act and were deemed to belong to the state-owned gambling operator Veikkaus’ exclusive rights.

Update and trends

Key developments of the past year

Highlight any noteworthy developments or trends in the gambling or quasi-gambling sectors (legal or business) and their potential implications.

Finland Legal Gaming Attorneys at Law 10 May 2023.

In September 2022, the state-owned gambling operator Veikkaus announced its new position regarding the licensing model, stating that it is ready to give up its monopoly position and transition to a licensing model. This can be seen as a conversation starter that has facilitated support for the change.

The government appointed a research group in January 2023 to study and analyse the licensing model. This measure was against the government’s programme in place, which stipulated that the monopoly must be preserved. The measure can, therefore, be interpreted as a change in the government’s will from protecting the monopoly as written in the government programme to transitioning to a licensing system. The study was published on 17 April and it presented a shift to a partial licensing system, including online casino games and sports betting, as a most prominent solution to deteriorating channelisation rate.

There has been a rapid shift in Finland in political consensus and will from defending the monopoly to supporting the licensing model. It is probable that during the next parliamentary term, from 2023 to 2027, a transition to a licensing system can be expected.