Was Sweden the best market liberalisation model for Finland to follow?

As Finland gets set to move away from a gambling monopoly model, as of January 2027, its neighbour Sweden’s gambling laws have acted as a model for the Finnish market.

But local legal expert Antti Koivula has warned that Sweden’s “ongoing issues” with its channelisation rate and the proliferation of illegal sites could mean it was not the ideal market for Finland to mirror.

Speaking to iGB, Koivula says Sweden is a natural choice for Finland to emulate as both countries share a similar gambling monopoly past, comparable welfare models and like-minded player protection standards.

Sweden underwent major gambling reform in 2019, liberalising its online gambling market and establishing a framework for taxation and licensing.

Finland’s new gambling regulation, which passed through parliament in March, has openly modelled its framework on Sweden’s laws, including allowing the state monopoly to compete in the market alongside private companies offering betting and igaming.

However, Koivula says by using Sweden’s framework, Finland has not sufficiently addressed the potential threat of the black market.

“No regulatory model is perfect”

“Sweden faces significant challenges, particularly with enforcement against the black market. This is a critical issue that Finland, unfortunately, has not adequately addressed and the proposed enforcement tools are likely to prove insufficient,” Koivula tells iGB.

Koivula argued that Denmark, or another similar market, could have better served as a model for Finland to follow.

“While the Swedish system was a perfectly logical starting point for Finland, it may not be the best benchmark, especially considering its ongoing struggles with the black market and limited dialogue between the regulator and the industry,” Koivula adds.

“No model is perfect, but if I were to choose, Finland would have been looking more closely at Denmark and perhaps at certain other jurisdictions such as Ontario.”

Why has Denmark been so successful?

Denmark opened its own online gambling market in 2012 and the approach has been widely considered a resounding success, as the Danish gambling authority (Spillemyndigheden) announced in April it had managed to maintain a channelisation rate of 90%.   

Morten Ronde, CEO for the Danish online gambling trade body Spillebranchen, previously told iGB the market has been successful in following a player behaviour-led approach to regulation.

In 2020, Sweden introduced mandatory online casino limits to protect players during the Covid-19 pandemic as the government expected player activity to soar in response to lockdowns.

However this move was heavily criticised and Ronde said Denmark instead maintained a close eye on data and player behaviours. It discovered players had not drastically increased their gambling and no measures were enforced.

“That prevented the government from intervening and placing similar restrictions on players like they did in Sweden, where they were only predicting there was going to be a problem,” Ronde said.

Where does Sweden’s model fall short?

Sweden is facing a number of challenges, but the government and regulator are actively trying to mitigate the impact of the growing black market.

The government opened a review of its Gambling Act in February after gambling trade body BOS sent it a letter requesting a loophole in the gambling law be reviewed.

The rules do not penalise illegal operators for offering activities in English and using euros, instead of Sweden’s local currency.

Additionally, BOS has long called on the government to privatise lottery monopoly Svenska Spel’s competitive business as its state ownership acts as a conflict of interest.

BOS again pushed for a sale in December, following the state’s sale of vehicle inspection company Bilprovningen to TÜV Rheinland.

This sentiment has been echoed in Finland already, as stakeholders have warned the government’s ownership of Veikkaus could give the operator a competitive advantage in the liberalised market.

In terms of illegal gambling, Swedish horseracing operator ATG said in Q4 online channelisation was between 69% and 82% across the entire market.

This is some way below the Swedish regulator’s long-term channelisation target of 90%, as revealed when the market launched in 2019.

Despite these ongoing challenges, Koivula says there are a number of positive moves made by Sweden, which were highlighted by those drafting Finland’s bill.

“The Swedish model has several strong aspects that the Finnish regulator has taken note of, Spelpaus (the national self-exclusion platform) being a notable example.”

Finland’s sales decline and opening market

Stakeholders, including Koivula, have told iGB in the past that Finland’s move to liberalise is in part an effort to improve Veikkaus’ position in the market.

The Finnish monopoly has seen sales decline in recent years. In its 2024 full-year results (published on 5 March), Veikkaus posted a sales revenue decrease of 7.3% year-on-year to €956.2 million.

Koivula supports the move to allow Veikkaus to compete against private operators.

“From Veikkaus’ perspective, the critical factor lies in ensuring a level playing field for its subsidiary that will be operating in the competitive market, while simultaneously safeguarding the monopoly structure in the other gambling verticals,” he says.

“The proposed legislation supports these aims effectively. While there’s always room for improvement, overall the direction is no doubt a positive one for Veikkaus.”

In anticipation of the reform, Sweden’s racing monopoly AB Trav och Galopp and Finnish equestrian association Suomen Hippos have established a joint venture to operate a brand in Finland’s market.

Finland’s initial legislation included restrictive marketing measures such as the banning of affiliate marketing and customer bonuses. After industry criticism, those were subsequently taken out of the bill sent to the EU for approval in November.