Brazil Launches Legal Online Gambling Market

Brazil launched its long-awaited legal online betting market on January 1st this year. Fourteen companies received full authorisation, and another 52 were granted provisional licenses, meaning they must correct specific issues before launching.

Brazil has eagerly anticipated this moment since the National Congress initially approved legislation for online betting in November 2018, with then-president Michel Temer signing it into law a month later. It took until December 2023 for the Chamber of Deputies to finally approve the law.

The Secretariat of Prizes and Betting (SPA), the government body responsible for regulating and overseeing Brazil's legal online gaming market, released a series of regulations in 2024 that informed operators of the rules necessary to secure a licence.

With the licensing window opening in May, operators had until August 20th, 2024, to ensure they would qualify for the January launch date. Only companies that applied ahead of the deadline received authorisation.

Provisional Licensees Facing Issues

Provisional licenses are valid for a period of 30 days, with those companies having paid the BRL30 million ($4.8 million) licence fee but facing issues, such as the delay in the certification of betting systems.

However, the provisional licenses can be extended for another 30 days, provided the operators receive support from the certifying entities, who agree that the provisional authorisation needs to be extended for full certification measures to be concluded.

 Rules Governing Betting Operators In Brazil

The SPA laid out its betting regulations in 2024 with some stringent rules:

1. Legal betting operators in Brazil are to include ‘.br’ at the end of their betting domains to ensure bettors and authorities can clearly distinguish which websites are licensed.
2. Bettors will need to register with facial recognition to restrict minors from gambling.
3. Monetary transfers can only be made to and from accounts authorised by the Central Bank of Brazil.
4. Betting with credit and cryptocurrencies is banned.

Operators will pay a tax rate of 12% of GGR, and player winnings above BRL2.824 will be subject to a 15% tax.

 Brazilian Betting Regulation to Tackle Ongoing Issues 

It has not been smooth sailing on the way to online gambling regulation in Brazil, with long delays in getting legislation over the line and the resulting criticism of the industry in the second half of 2024.

However, SPA chief Regis Dudena believes that following the full regulation of the market, Brazil can now work to ensure a safe environment for bettors. He stated that the country was taking a fundamental step towards addressing the potential problems associated with the gambling market.

“We will start 2025 with strict and clear rules, in addition to mechanisms to demand their compliance, operators will be held accountable,” Dudena said of the January launch.