It has taken several years, but sports betting has finally been legalised in Brazil. It was recently revealed that President Luiz Inácio Lula da Silva, affectionately known as ‘Lula’, has signed into effect a law that was put forward back in 2018. This law effectively legalises sports betting in the South American nation, but there were several caveats to the bill being signed in the first place. Most importantly, the new law needs to be approved by Congress within 120 days for it to be fully written into the country’s charter.
This is a huge step forward for Brazil, especially considering the ‘betting wave’ that’s currently washing over much of the world as we speak. In recent years, much of the United States has opened its doors to sports betting practices, and only a few states are holding out against the trend. As betting becomes much more accessible, diverse, and dynamic, more and more nations and territories are looking to take advantage of the growth.
It’s not without its issues, but the new law signed by President Lula means that lucrative sports betting markets could be legalised across Brazil if National Congress agrees to ratify the law. There are some key problems with the proposed bill, though. Firstly, industry experts are questioning the super-high tax rates being imposed on operators that acquire a license to trade in Brazil – as much as 31%.
There are also questions being asked about how payments will work – specifically banking codes and transactions. It was highlighted in one report that the Central Bank of Brazil has in place a payment code that’s the same for sports betting as well as poker and casino games. There are now concerns that this code applies despite all these games now being regulated very differently. There are also some grey areas in the documentation that’ll need to be ironed out concerning regulatory risk.
Now, the Ministry of Finance will need to put in place a National Secretariat for Games and Betting. This office will employ a total of seventy people to handle operator applications, betting licenses, and technical regulation.
What Are The Changes?
It was revealed that several changes were made to the original law put forward in 2018.
Firstly, the tax on revenue for betting operators in Brazil was boosted, increasing the revenue that’ll eventually flow into the Ministry of Sports. There are reports that the cost of a license has also increased, jumping up to RS$30 million from around $RS 22.2 million. That’s approximately $6.35 million USD. Furthermore, ‘foreign operators’ now have a clause written into the law that states they can finally apply for licensure.
With deeper regulations in place, Brazil sports betting can become a more legitimised ecosystem – but time and effort need to be expended before that can be reached. It’s a step in the right direction for the country, but only time will tell if the venture is successful and if National Congress ratifies the law at all.