Brazil shortens deadline for online gambling companies

The Brazilian Finance Ministry on Tuesday brought forward a deadline for sports betting platforms to comply with regulations, banning them from operating in Brazil if they have not filed a request for authorization from the government by September 30.

Under rules published in May, the ban on unlicensed companies was to start on January 1, 2025.

“From October onwards, companies that have not requested authorization through the Finance Ministry’s Gambling Management System (Sigap) will be classified as illegal until they obtain authorization,” the Finance Ministry said in a statement.

Platforms will be required to pay a license fee of BRL 30 million (USD 5.4 million) in order to operate up to three brands for five years, as well as follow rules to fight money laundering and abusive advertising, among others.

By mid-August, 113 companies had requested licenses to operate in Brazil. The ministry opened the registration process back in October 2023.

The federal government has been under pressure to further regulate sports betting. Isaac Sidney, head of banking association Febraban, recently called for the government to bring forward the deadline to ban gambling payments with credit cards, a restriction that will take effect at the turn of the year. 

Banks are concerned that gambling addictions may lead to higher default rates among borrowers. Similarly, a study commissioned by a major Brazilian retailers association suggests that 63 percent of betting platform users have had their income compromised by gambling losses.

Back in August 2023, The Brazilian Report revealed in an exclusive story that the Luiz Inácio Lula da Silva administration caved in to betting platforms and initially refrained from taxing all winnings from sports betting, despite technical recommendations from staff at the Finance Ministry and Brazil’s Federal Revenue Service. The president later changed his mind.