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NEWS 23 September 2019

Brazilian sports betting expected to be regulated in Q4 2019

By Matthew Enderby

Marcelo Munhoz da Rocha, Legal Advisor at BetConsult, speaks to Gambling Insider, providing an update on Brazilian sports betting legislation.

What is the current state of sports betting legislation in Brazil?

In December 2018, Brazil approved law 13756/2018, which legalised the activity of fixed-odds sports betting. This piece of legislation legalised the activity and also gave it the status of a lottery type game.

Even though the activity of fixed-odds sports betting was legalised, it is still pending regulation. To provide the best regulation decree possible, the Federal Administration, via the Ministry of Economy, held a public consultation in August to gather suggestions from the gambling community, with a focus on taxation and license-granting modality.

As a response to the public consultation, an initial regulatory decree has been disclosed with the gaming community. According to the decree, fixed-odds sports betting will be operated in a free market environment, in the authorisation license-granting model, in which the operator or consortium interested in operating must meet certain legal requirements.

The mentioned decree isn't perfect and it is not definitive. A complimentary decree is expected and, for that, the Ministry of Economy has opened a new public consultation that will end on 27 September. It is expected that the new decree will provide official information about license fees, license terms and other details such as taxation and other incurring fees.

What are the costs of license fees?

It's still unofficial because it was not the object of the initial regulatory decree but it is expected the license fee will cost R$3m (US$723,150). This is still to be confirmed by a complimentary regulatory decree.

Will these be off-putting to operators or are they within means?

Considering it will be an authorisation model, paying a fee of R$3m to have a legal and regulated operation in Brazil can be a good deal for operators and consortiums. 

How is the public perception of sports betting developing? 

The illegal, or grey, sports betting market is already very valuable and has users in Brazil. The legalisation and regulation will manage to shed legal light on an activity already a part of the Brazilian sports fan, and also turn it into a taxable activity.

Very relevant media operators, which were once against the legalisation, have changed their perspective about this issue. Now it is common to see advertising related to sports betting on TV and other media vehicles. 

When is sports betting likely to become active in Brazil?

According to forecasts, it is expected regulation will be completed during the last quarter of 2019, with the license-granting process to begin subsequently.

What are the last hurdles sports betting needs to clear before it is regulated in Brazil?  

Since legislation has already been approved, it is just a matter of definitive regulation to be presented and for the license-granting processing to start.

However, there is a possibility Congress might need to amend the Law 13756/2018, adding a provision about unclaimed prizes.

RELATED TAGS: Online | Land-Based | Industry | Sports Betting
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