Is Sports Betting & iGaming in Brazil Legal?

The sports betting and online casino landscape in Brazil is set to enter a new era. This comes after the chamber of deputies endorsed Bill 3,626/2023 on December 21, 2023, and the president, Luiz Inácio Lula da Silva, signed it into law on December 30, 2023.

The new regulation amends Law No. 13,756/2018 on fixed-odds betting, opening Brazil’s online gambling market to new and diverse investors. Operators looking to provide online gambling services must obtain a Brazil gambling license from the Ministry of Finance and pay a maximum fee of BRL 30 million.

What other online gambling changes does the new law on sports betting in Brazil bring into effect? Read on as we explore what’s next for the Brazilian internet gambling market.

The State of Online Gambling in Brazil

The new gambling law in Brazil allows betting site operators to offer fixed odds on sports and online game events. However, to run a gambling sportsbook in Brazil, companies must meet the following criteria:

Authorization Requirements

To be eligible for a gambling license, companies must meet several gambling regulations set by the Ministry of Finance. Willing candidates must have prior knowledge and experience in offering online and offline lotteries, bets, and games.

Interested parties must also have advanced technology in place to minimize the risk of cybersecurity fraud, including money laundering and match fixing. A licensed gambling company can operate up to three different brands, paying a maximum license fee of R$30 million (€5.6 million), valid for five years. Operators must also pay a monthly fee for inspection services. The fee will range from BRL 54,419.56 to BRL 1,944,000.00 (based on the operators’ net revenue).

Another regulatory compliance that operators must meet is local ownership. According to the new sports betting law, a gambling company must have a Brazilian party owning at least 20% of its share capital.

Corporate Policies

For a company to obtain and maintain a gambling license in Brazil, it must have well-curated policies, procedures, and controls about responsible gambling. These include a know your customer policy to prevent money laundering and financing of terror activities, customer support and complaint procedures, and measures to control match fixing and other forms of gaming fraud.

Players’ Rights

Operators must provide players with clear information about the financial risk of sports betting, problem gambling, and the guidelines for making predictions and determining prizes. The companies must also offer free customer service in the Portuguese language, whether via telephone, FAQ, email, or live chat.

Payments

The new sports betting law in Brazil prohibits financial and payment merchants from authorizing betting transactions with unauthorized operators. The Ministry of Finance requires a betting company to have policies that analyze online gambling patterns to determine activities that indicate potential money laundering, terrorism financing, or both. Any suspected case must be reported to the Financial Activities Control Board.

Gambling Advertising Regulation

The new sports betting law in Brazil authorizes the Ministry of Finance to oversee online sports betting and casino advertising and marketing activities. To ensure this comes into effect, the Council for Self-Regulation in Advertising (Conar) recently approved Annex “X” of the Brazilian Self-Regulation Advertising Code.

Annex “X,” which is based on several consumer protection principles, came into effect on January 29, 2024. The key advertising provisions within the Annex include:

• Advertising must not suggest that betting can lead to financial gains nor provide misleading information about the probability of winning
• An advertisement must show the betting company responsible for the ad, authorization ID, and contact data.
• Social media influencers looking to advertise online gambling must be verified.
• Any gambling ad must include age restrictions (not for persons under the age of 18) and a problem gambling warning to promote responsible gambling

The published CONAR guide, which is available in Portuguese, summarizes these advertising rules.

Gambling Tax Rate in Brazil

According to the taxation recommendations made by the Economic Affairs Commission on 22 November, gambling revenue will be collected in two ways:

• Taxation of operators. The gambling tax rate will be 12% of the net gambling revenue, a reduction from the initially proposed 18%. Operators will also be subject to corporate taxation.
• Taxation of bettors. Gamblers will be subject to a 15% gambling tax on their net winnings from fixed odds and lottery.

The bulk of the total tax revenue collected will be devoted to sports development.

iGaming in Brazil

On 12 December 2023, the legislator (Brazil’s senate) voted to approve sports betting, removing iGaming from Bill 3,626/2023. However, the Chamber of Deputies exercised its powers and retained iGaming in the Bill, which was signed into law by the president on 30 December 2023.

This inclusion was a win for the whole gambling landscape in Brazil, preparing the way for other verticals and markets. iGaming is a source of additional tax income and employment, boosting the overall economy of the country.

Online Gambling is Legal in Brazil

Online gambling in Brazil is now legal. On 30 December 2023, the president signed Bill 3,626/2023 into law. The law introduces new regulations that operators and gamblers must meet.

For an operator to obtain a gambling license from the Ministry of Finance, a Brazilian board member must hold at least 20% of the company’s capital share. Gambling companies in Brazil must also pay a license fee of up to R$30 million (€5.6 million), valid for five years. Operators must also have technology and policies for responsible gaming, online advertising, and fraud prevention.

Bettors must be over 18 years old to participate in any sport, lottery, or casino gambling activity. Gamblers’ identity verification will be done through facial recognition technology and personal data available on a public database under a strict privacy policy.

FAQ

Is online gambling legal in Brazil?

Yes, online gambling is legal in Brazil. On 30 December 2023, the president signed Bill 3,626/2023 into law, legalizing sports betting and online casinos.

Why was gambling banned in Brazil?

Until the 1940s, when the then-president introduced a blanket ban on gambling, games of luck were legal in Brazil. The ban was driven by his catholic view and remained in place until the 1970s when the state introduced lotteries. In the mid-1980s, the state approved horse racing betting. Poker, which is regarded as a game of skill, has remained legal in the Brazilian gambling market for many years.

What is the new online gambling regulation in Brazil?

The new gambling regulation in Brazil requires an operator to be headquartered in the country and obtain a gambling license from the Ministry of Finance. This regulation will ensure the government collects revenue from licensed gambling companies. Foreign betting companies are prohibited from offering regulated gambling services in Brazil.