Will Finland ban affiliate marketing?

Garance Limouzy September 16, 2024

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Will Finland ban affiliate marketing?

As Finland prepares to change its gambling regulations, a crucial question looms: Will the new legislation impose a ban on affiliate marketing?

The Finnish government is expected to release a revised version of its gambling bill by the end of October, aiming to transition from a state monopoly to a multi-licensing system by January 2027. The bill, which will be submitted to the European Union for review, is anticipated to open the market to licensed operators and address a range of regulatory issues.

While the gambling industry eagerly awaits these changes, certain parts of the initial draft have raised concerns. Among the most debated issues is the potential ban on affiliate marketing.

Some experts, as reported by Vixio, have noted that the current version of the bill is unclear. The use of the term “third-party advertisers” could refer to both affiliates and traditional print media, leading to calls for further clarification.

Channelisation concerns

Industry stakeholders worry that such a prohibition could inadvertently benefit the black market by pushing players away from licensed sites.

Jari Vahanen, head of The Finnish Gambling Consultants and a former Veikkaus executive, finds the proposed affiliate ban problematic. He argues that excluding affiliates from the regulatory framework could lead to increased advertising by unregulated operators, undermining the goals of the bill.

Veikkaus, the state-owned monopoly set to lose much of its dominant position under the new law, has seen its market share decline as the grey market expands. According to Vahanen’s estimates, Veikkaus’ online market share fell to 50.9% in 2024, with further declines expected.

EGBA’s response

The European Gaming and Betting Association (EGBA) has also expressed strong concerns over the proposed marketing restrictions. In a press release, EGBA Secretary General Maarten Haijer called for revisions, warning that “the proposed ban on affiliate marketing and social media advertising might backfire.” He argued that these channels play a crucial role in guiding consumers to regulated platforms and that their exclusion could drive players to unlicensed sites.

The EGBA has proposed bringing affiliates into the regulatory framework and allowing social media advertising under clear guidelines. “Both are valuable tools for channelling players towards licensed operators. By implementing clear guidelines, such as mandatory safer gambling messages, Finland can harness the power of these marketing channels while maintaining high standards of consumer protection,” the association stated.

Haijer also criticised the blanket ban on bonuses, suggesting that it would make newly licensed operators less competitive against unregulated sites. He recommended a more nuanced approach, allowing bonuses under certain conditions with responsible-use guidelines to better protect consumers and ensure market competitiveness.

Next steps

As Finland’s gambling legislation moves closer to finalisation, the debate over affiliate marketing remains a critical issue. The industry’s response and potential amendments to the bill will be closely watched, as they will shape the future dynamics of Finland’s gambling market and its alignment with broader EU regulatory trends.

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