Brazil’s Online Gambling Sector Faces Potential Ban Under New Bill
On October 21, 2024, Senator Sérgio Petecão (PSD-AC) introduced a bill (PL 4.031/2024) proposing a complete ban on online gambling and betting in Brazil. The bill aims to prohibit all forms of virtual gambling, with the exception of the federal lottery and physical betting, where printed tickets are provided.
Petecão justified the proposal by citing concerns over mental health, debt risks, and the accessibility of online gambling to minors. His bill aligns with growing legislative efforts to restrict online betting, including a requirement for internet service providers to block access to gambling sites and applications that offer fixed-odds betting.
Federal Government's Approach to Regulating Online Gambling
The debate over online betting in Brazil has been ongoing since the Michel Temer administration legalized betting in 2018, expecting regulation to be implemented within two years. However, a lack of clear guidelines allowed the market to grow without proper oversight, mixing legitimate businesses with fraudulent operators.
In 2023, the Ministry of Finance under Fernando Haddad began addressing these regulatory gaps, introducing a provisional measure in July that established important rules, such as:
Prohibiting minors from gambling.
Restricting advertising for unauthorized platforms.
Requiring betting operators to have offices in Brazil and pay taxes.
Establishing penalties for non-compliance.
This provisional measure, later converted into law in December 2023, assigned the Ministry of Finance the responsibility of regulating the sector and created the Secretariat of Prizes and Bets (SPA/MF) to oversee the process.
Stricter Regulations on Advertising and Consumer Protection
Since then, authorities have implemented regulations that include banning credit card use for gambling, enforcing money-laundering prevention measures, and promoting responsible gaming practices. Companies are now required to identify bettors and assess their financial and mental health vulnerabilities, with the ability to restrict access for at-risk individuals.
Advertising also came under stricter rules, with a focus on preventing campaigns targeting minors and ensuring that gambling is not portrayed as a guaranteed investment. Digital influencers are now subject to regulations that prevent misleading endorsements.
Efforts to Regulate and Block Illegal Sites
In addition to tightening controls on legal operators, the government has launched a rigorous licensing system. By July 2024, 100 companies had been authorized to operate, with over 220 betting sites approved. A "negative list" of over 2,000 illegal websites was also created, and efforts to block them are ongoing in coordination with the Central Bank and other ministries.
The Future of Online Gambling in Brazil
While the federal government has worked to regulate the industry, Petecão’s bill would halt all online betting activities in Brazil if approved. This includes online sports betting and casino-style games, aiming to modify the 2023 law that currently governs the sector. The proposal allows only physical, in-person betting with printed tickets.
The bill is still awaiting debate in the Senate and faces opposition from other lawmakers. Senator Jaques Wagner (PT-BA) previously pointed out that various legislative initiatives are emerging in response to concerns about gambling, but he emphasized that the legislative process in Brazil is often slower than expected.
As more bills related to gambling are introduced, the future of online betting in Brazil remains uncertain. If passed, Petecão’s bill would mark a significant shift in the country’s gambling landscape, with potential economic and social implications for both operators and consumers.
