Date: 25.07.2023

by Mateusz Mazur

Major Breakthrough: Brazil Legalizes Sports Betting After Years of Delays

After years of discussions and delays, Brazil has taken a significant step towards regulating the sports betting industry. President Luiz Inácio Lula da Silva signed the Provisional Measure (PM) that implements the 2018 law, officially making sports betting legal in the country. This decision comes after a long process of legislative approval and sets the stage for the much-anticipated entry of legal sports betting operators into the Brazilian market.

Amendments to the Regulations

With the signing of the PM, several amendments have been introduced to the 2018 Brazil sports betting regulations, which were initially approved in Law No. 13,756. Notable changes include an increase in the gross gambling revenue tax from 16% to 18%.

This higher tax rate is aimed at increasing the revenue flowing to the Ministry of Sports, with the amount rising from 1% to 3%. Additionally, the license fee has been raised to R$30 million, up from the previously established R$22.2 million. These changes reflect the government’s efforts to strike a balance between generating revenue and regulating the industry effectively.

Establishment of the National Secretariat for Games and Betting

The signing of the PM paves the way for the establishment of the National Secretariat for Games and Betting (SNJA), which will be responsible for regulating the sports betting sector. To ensure smooth operations, the Ministry of Finance has been actively hiring employees for the new regulator since last month, and it is expected to have a total of 70 staff members.

The creation of SNJA is a crucial milestone, as it will set the stage for the formulation of licensing procedures and other technical regulations for the industry.

Changes in Taxation and Licensing

The PM includes a significant update regarding licensing, allowing foreign operators to apply for licenses in Brazil. This decision clarifies any ambiguity that may have existed in the original regulations.

Additionally, the increased tax rate and license fee signal the government’s commitment to maximizing revenues and creating a regulated and competitive market.

These changes aim to attract responsible and reputable operators while providing players with a safe and fair gaming environment.

A Long-Awaited Move

The legalization of sports betting in Brazil has been a topic of discussion for several years. The country’s Secretariat of Evaluation, Planning, Energy, and Lottery (SECAP) published its rules and regulations for sports betting in May 2022, setting a deadline for approval by December 2022.

President Lula’s decision to sign the PM comes after his election victory and is seen as a more favorable stance towards the gambling sector compared to his predecessor, President Bolsonaro. The move to regulate sports betting is also fueled by public pressure, especially in the wake of match-fixing scandals, and is expected to bring significant economic opportunities to the country.