Brazil betting association warns market may not recover after proposed ban

Brazil's sports betting sector is awaiting a decision by Supreme Federal Court (STF) Justice Luiz Fux on challenges to a provisional measure that would prohibit sports betting in the country, according to the president of the Brazilian Institute of Responsible Gaming (IBJR), Carlos Lima. The measure was signed on 25 September. The Finance Ministry had not formally issued a notice revoking operators' licences, a step that had been expected on 25 October, the ministry said, without detailing the process.

Lima said more than 3,500 people have lost jobs in the sector since the measure was signed. He said some companies had cut almost their entire workforce, keeping only legal and compliance departments, while areas such as customer service were eliminated. He said it is difficult to say how many companies will be unable to resume operations, adding that small firms without the backing of large groups may not have the capacity to continue in Brazil.

Companies in the regulated sector each paid R$30m in a mandatory licensing fee plus R$5m as a financial reserve, according to the report. The federal government collected about R$2.55bn from 85 licences, and the amounts will not be returned, according to the official position cited. If authorisations are revoked, companies could accelerate dismissals, with staffing limited to statutory directors. Legal experts cited in the report said the measure could take effect automatically, without a notice to companies.

Asked about the process, the Finance Ministry said the extinction of authorisations does not remove operators' obligation to meet remaining requirements by a deadline of 15 December 2026.

Lima said the sector would like Fux to grant an injunction as soon as possible, because the longer it takes, the more the negative effects of the prohibition, such as dismissals, increase. He said the IBJR shares the concern that some investors do not intend to resume operations in Brazil even if the measure is reversed, but he could not say how many companies have left the country permanently.

While awaiting a decision, betting companies launched a campaign called “Aposto que você não sabia”, led by the IBJR and the National Association of Games and Lotteries (ANJL), to highlight the sector's regulation and the risks of illegal gambling. Barred from displaying their brands on club shirts and advertising boards at football matches, the companies gave those spaces to campaign messages in the Brazilian championship. Flamengo, São Paulo and Fluminense played matches with the phrase “Proibir não é proteger” on their kits.

Lima said that with the prohibition people became more exposed to scams by clandestine platforms. Flamengo, which the report says receives R$268.5m a year from Betano, filed a challenge in the case before the STF. In a match against Fluminense on 11 October, Flamengo supporters jeered President Luiz Inácio Lula da Silva over the prohibition. Betting houses put more than R$1bn a year into sponsorship in Brazilian football, according to the report.

Fux has scheduled a public hearing on the case for 3 November, and the sector expects a decision in the coming days. The provisional measure must be analysed by Congress within 120 days to become law. Lima said the sector has always been open to dialogue and had been discussing with the Finance Ministry what is needed to improve regulation, including measures against platforms advertising illegal bets.