18 October, 2022

LatAm in its sights

Aposta Hub Brazil website Co-Founder and lawyer, Ricardo de Paula Feijó, speaks to Gambling Insider about the state of legal sports betting in Brazil, new foreign investment and LatAm expansion.

How is foreign investment affecting the gaming industry in Brazil right now?

Creating a legal framework that stimulates competition should be one of the main goals of the Brazilian Government. In that sense, foreign investment and companies coming to Brazil to explore the gaming market contribute to a better development of the sector. This is something of paramount importance considering that many gaming activities are currently illegal and hold back developmentof the necessary expertise for national companies. On the other hand, legal gaming activities such as lotteries are underperforming considering international benchmarks, and havea lot of space to grow.

Is Aposta Hub looking into expanding in the LatAm market?

As a company focused on the affiliate market, Aposta Hub is focusing on the development of sports betting, especially in Brazil. The Brazilian sports betting industry has grown exponentially in the last 12 months, but it is still far from its maximum potential. Our expectations lie in the upcoming regulation by the Federal Government of sports betting and the likely approval of the Gaming Act by the Federal Congress. Regarding the LatAm market, Aposta Hub aims to be the largest online betting portal in Latin America; consolidating itself first in the Brazilian market and then expanding to countries with high potential such as Colombia, Mexico and Chile. Our goal is to help both players and companies with our legal expertise and industry knowledge.

What are your expectations of the future for the sports betting market in Brazil?

Online sports betting became legal in Brazil in 2018 but is still pending regulation from the Federal Government, on how this activity will be licensed and explored. The deadline for the regulation expires on 12/12/2022. Obviously, the regulation of sports betting will have an enormous impact on gambling companies and those planning to participate in this market. The Federal Decree drafts of sports betting intend to establish an open market that will allow all serious companies to invest in Brazil. That means every company that proves to have the technical and economic capacity and pays BR$22m ($4.27m) will be granted a licence for five years. The Federal Decree drafts allow foreign companies to explore the activities but stipulate the necessity of establishing a branch in Brazil. However, the decree is not defined yet. At the same time, sports betting is being developed by state lotteries since it is considered a kind of lottery in Brazil. Some states are authorising companies to operate sports betting, such as the states of Maranhao and São Paulo. The Government has launched public bidding to authorise one operator to explore a state lottery, which includes sports betting in its territory. However, the bidding is suspended and it is most likely to be revised after federal regulation. The product compliance required from the operators also varies from each state. In most cases, it has been mandatory to obtain international certifications that assure the safety and quality of products. Operators also need to have a compliance program to guarantee that regulations are observed.

What other obligations currently exist in relation to gambling in Brazil?

Well, the Brazilian Congress is discussing the Gaming Act, which can legalise casinos, bingo halls and other gaming activities. It also encompasses online gaming but only to authorise it, delegating its regulations to an executive decree. It does not address foreign companies specifically; these, again, will be further detailed in executive acts. The Law Bill is expected to be voted on at the end of the year, after the elections for President and Federal Congress. So the Gaming Act will definitely affect the market in every sense, and Aposta Hub is closely following its progress.