Local expert Jari Vähänen has advised the Finnish government to divest its ownership in Veikkaus, the state-owned betting monopoly, ahead of the legalisation of the country's online gambling market in 2027. The move, he suggests, would prevent Veikkaus from gaining an unfair competitive advantage over licensed operators and resolve a potential conflict of interest.

According to Vähänen, a partner at Finnish Gambling Consultants (FGC), the dual role of the Finnish government—as both the owner of Veikkaus and the entity responsible for regulating the gambling market—poses a significant risk of conflict of interest. This concern has also been highlighted by Finland’s chancellor of justice and the competition and consumer authority in their responses to the draft regulations released by the Ministry of the Interior in June.

"The Finnish state wants to maintain a dual role, taking care of the legislation and supervision of gambling activities, while also owning the company involved in these activities. There is a high risk of conflict of interest in such a model," FGC's response noted.

The Ministry of the Interior has indicated that the state may consider selling off part of its ownership in Veikkaus if it is deemed beneficial for the development of the state’s shareholder value. However, the exact approach to this potential divestment remains unclear.

Veikkaus’ Legacy Database and Competitive Edge

One of Vähänen’s primary concerns is the advantage Veikkaus could gain through its legacy player database and technology infrastructure. He believes these assets could provide Veikkaus with a significant competitive edge over new market entrants when the Finnish online gambling market opens to licensed operators in 2027.

Under the proposed regulations, Veikkaus will be restructured into separate operating units, including its monopoly arm, business-to-business operation Fennica Gaming, and a licensed online gaming business. While Veikkaus will retain exclusivity over certain games, such as lottery, toto games, scratchcards, and slot machines, there is uncertainty over how its online business will be separated from the monopoly operations.

Vähänen, who spent seven years at Veikkaus between 2013 and 2020, has called for clear policies on whether Veikkaus’s current customers can be transferred to its licensed business. He also stressed that the monopoly and the licensed online business should not share the same resources or technology, as this could distort competition.

Concerns Over Monopoly and Market Regulation

Vähänen has raised further concerns about Veikkaus’s potential monopoly over pool-based horse betting and digital instant win games, arguing that there are no credible justifications for keeping these under state control. He believes that the monopoly should not be allowed to offer the same games as the licensed online business and that separate technologies should be used for the monopoly and licensed operations to ensure fair competition.

In addition, the draft regulations propose banning bonusing and affiliate activities, which Vähänen warns could harm channelisation rates—the process of guiding players from unregulated to regulated gambling environments. He suggests that if affiliate activities were allowed, they should be subject to the same marketing regulations as gambling operators and media companies. He points to the Romanian model, where affiliate operators are required to have a separate business license, as a potential approach for Finland.

As Finland moves towards the legalisation of its online gambling market, the debate over the future of Veikkaus and the potential conflict of interest in its dual role will likely continue to be a key issue. Vähänen’s recommendations aim to ensure a fair and competitive market for all operators while addressing the concerns raised by various stakeholders.