Brazil approves landmark legislation: sports betting and online casinos set to transform industry

Lea Hogg December 22, 2023

SiGMA news

Brazil approves landmark legislation: sports betting and online casinos set to transform industry

Brazil is set to introduce a federal sports betting marketplace that encompasses regulations for online casino games. The Chamber of Deputies’ final session approved Bill PL3626/23, forwarding it to President Lula da Silva for federal approval.

The bill was returned to the Chamber after an inconclusive Senate review, which omitted online casino games due to disagreements among Liberal Party Senators.

261 votes in favour

The Senate sent the bill back, requesting Deputies to review over 100 changes made to the legislation since its submission for federal modalities review. In the recent voting session, Evangelical deputies, in collaboration with the opposition, tried unsuccessfully to remove the provision for online games. A majority of 261 deputies voted to retain online games, while 120 voted against it.

12% tax on licensed operators

The approved proposal restored authorization for virtual online gaming events, or online casinos, which had been removed by the Senate. The ‘Evangelical bench’ in the Chamber stated their intention to urge President Lula to eliminate casino modalities during the bill’s Presidential sign-off, echoing events from late 2022 when former President Bolsonaro refused to sign sports betting into law.

The fiscal and tax structures proposed by the Senate’s Economic Affairs Commission were maintained, imposing a 12 percent tax on licensed operators in Brazil’s federal market and a 15 percent tax on player prizes. 2 percent of the generated income will be allocated to social security, with 6.63 percent and 5 percent going to the sports and tourism sectors, respectively.

At least 134 businesses declare interest

Operators, whether domestic or foreign, must pay BRL 30 million (approximately €5.5 million) for a federal licence valid for five years, allowing the operation of up to three brands. Requirements include establishing a presence in Brazil and appointing a legal guardian.

Betting will be overseen by companies authorized by the Ministry of Finance, meeting specific criteria, including a Brazilian board member with at least a 20 percent share capital. Before the recent proceedings, 134 businesses expressed interest in joining Brazil’s online gambling marketplace.

The Ministry of Finance will manage the federal sports betting market, ensuring standards, conduct, and consumer protections. Advertising and sports integrity duties were agreed upon, prohibiting ads that portray gambling as socially attractive.

The legislation also prohibits individuals under 18, those with gambling disorders, and key sports personnel from participating in betting activities to safeguard sports integrity.

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