Sweden or Denmark? The Regulatory Blueprint Finland Should (Not) Follow

Finland stands at a pivotal moment in gambling reform. As the country prepares to open its online gambling market by 2027, legislators and regulators face a crucial decision: should Finland emulate Sweden's rigid and over corrected model, or learn from Denmark's more collaborative and measured approach?

The differences between the two systems are not just technical; they reflect fundamentally different philosophies on regulation, market trust, and long term sustainability. Indeed, the stakes are remarkably high.

The Swedish Experiment: A Cautionary Tale

Sweden liberalised its gambling market in 2019, introducing a licensing system meant to improve oversight, generate tax revenue, and protect consumers. However, its implementation was widely criticised by both operators and players. A total bonus ban, coupled with a strict advertising environment and often vague rules, created significant frustration across the industry. Operators found it difficult to compete with unlicensed sites, leading to the country’s channelisation rate hovering at a disappointing 70 percent, far below the government’s own targets.

While strict limits during the Covid-19 pandemic might have also played a role in this outcome, it is clear that regulatory challenges were a significant factor. It seems even regulators can sometimes miss the forest for the trees when trying to protect it too much.

The clearest cautionary tales from Sweden involve the mismatch between enforcement capacity and regulation complexity, alongside a notable lack of communication with operators. Changes often came with little notice, undermining trust and making long term planning almost impossible.

Denmark's Pragmatic Success

In contrast, Denmark adopted a more pragmatic regulatory model when it opened its market in 2012. While maintaining a strong commitment to responsible gambling, Danish authorities worked closely with operators to ensure the regulations were realistic, enforceable, and reflective of player behavior. There was room for marketing, limited bonus use, and open dialogue.

The result? A channelisation rate consistently above 90 percent, greater operator compliance, and less migration to grey or black markets. This demonstrates that finding a balance is not just a dream, but a highly achievable reality.

The Affiliate Dilemma: A Critical Choice for Finland

One specific area where Finland’s proposed approach diverges significantly from established, effective models in regulated markets, and risks replicating some of Sweden's challenges, is the proposed ban on affiliation marketing. This has caused significant concern among gaming professionals. While diverse opinions exist regarding affiliation, it is a crucial element for maintaining a high channelisation rate. For consumers, comparison websites serve as an excellent tool to evaluate different operators and seek information on licenses and trustworthiness. For operators, especially smaller and medium sized ones, it provides a cost effective way for market entry.

Indeed, affiliate marketing is not banned in Denmark or Sweden. Finland’s decision to ban it outright, despite its proven benefits for market entry and player information, risks inadvertently hindering channelisation and pushing players towards the unregulated grey market. We must stop shooting ourselves in the leg and pretending not to listen to industry experts, nor observe our close Nordic neighbours on the affiliation side. To achieve the end goal, getting as many players within licensed operators as possible, we simply cannot ban the whole internet after all.

What This Means for Finland: The Crucial Choice

So what does this all mean for Finland? Regulation alone is insufficient; its tone and structure, whether collaborative or punitive, will define its effectiveness. Finland must decide if it is designing rules to genuinely protect players or merely to control them, and if it intends to support legal operators or push them into bureaucratic quicksand.

To avoid the pitfalls observed elsewhere, Finland must embrace a living regulatory system that evolves, listens, and responds.