Brazil Starts Consultation on Sports Betting Services Decree

  • Second round of consultation follows initial phase held during July-August
  • Draft decree includes details of operators' 1% turnover tax allocation
  • Applicants must meet strict guidelines to be approved for sports betting licensing
  • Comments will be accepted by the ministry via the consultation until September 27
cogs which read rules, regulations, standards, policies, and compliance
The Ministry of the Economy in Brazil has begun a consulting phase during which it will receive comments on the draft sports betting services decree published recently. [Image: Shutterstock.com]

Sports betting services launch looming

As Brazil prepares to introduce online and land-based sports betting services, its economy ministry has announced a second consultation to review the rules and regulations of the soon-to-launch industry.

the last opportunity for the betting industry to suggest any changes

The Brazilian Ministry of the Economy’s Secretariat of Evaluation, Planning, Energy, and Lottery (SECAP) published a draft of the decree regarding fixed-odds sports betting for additional comments. This is the last opportunity for the betting industry to suggest any changes.

Details of the decree

In the draft decree published, the economy ministry explains how the government of Brazil will govern the market. The ministry itself or a successor body will oversee the processing of licensing applications as well as enforce sports betting regulations.

deadline for additional comments to reach the ministry is September 27

The new consultation on the draft decree will run for a shorter period than the previous consultation, which took place from July to August. The deadline for additional comments to reach the ministry is September 27.

Turnover allocation

The decree confirms a 1% turnover tax on operators. Detailed breakdowns show how funds are to be allocated.

Land-based operators will see a 0.15% turnover that will be allocated to social security programs. An additional 0.1% will go towards public education. Another 0.1% will go to the National Public Security Force. Football clubs will receive the remaining 0.65%, which will be used for the branding and promotion of sports betting. The decree also states that online operators are to give 0.1% of their turnover to the National Public Security Force, public education, and social security. Football clubs will receive 0.7%.

The sports betting market will be open to players aged 18 and up. All forms will be account-based to ensure that those participating are old enough to do so.

Licensing details

The published decree states that a licensee must meet certain criteria to offer its services. Applicants cannot have a history of wrongdoing in criminal, administrative, civil, or financial matters.

Those interested in applying must have financial reserves at a minimum of R$6 ($1.5m). The operator must state they have never offered services in any other regulated market in an illegal manner.

Executives of the applicant must undergo a background check. Any individual convicted of a crime will not be able to work within the company until eight years have passed since their conviction.

Strict advertising regulations

Licensees must adhere to strict regulations regarding advertising sports betting. Advertisements must contain warnings about the dangers of gambling, while betting slips must contain warnings and be clearly displayed on the websites of the license holder. Ads cannot include fake or misleading claims, nor can they feature minors.

On top of meeting advertising requirements, operators must also work to prevent money laundering and terrorism financing. Processes must include customer checks as well as staff training programs and sales agent testing.

According to VSO News, sports betting in Brazil became officially legal in December 2018, when the outgoing president Michel Temer signed the new law. The change in Brazilian law is potentially lucrative for the country and operators that will offer services in the region.

Attempts to legalize the industry over the years were unable to come to fruition. However, legalization finally came about after new methods were needed for the country to raise funds.  

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