Brazilian measure threatens 85 betting authorisations worth R$2.55bn

Federal authorisations for 85 fixed-odds betting operators, held by 82 companies, could be extinguished from 25 October under article 4 of Provisional Measure 1.394/2026, according to reported details. The 30-day period set by the measure ends on that date, before the National Congress has deliberated on the text. Each authorisation cost R$30m and is valid for five years; the extinction would occur without repayment of the amounts paid.

The authorisations are granted by the Secretariat of Prizes and Betting (SPA) of the Ministry of Finance. The regulated market began operating in January 2025 under Law 14.790/2023, and companies had to meet technical, financial and security requirements, pay the set amount and operate under federal supervision. Without a valid authorisation, no site may legally offer betting in Brazilian territory, even if the activity is permitted again in future. The government, in the measure published on 25 September, classified the authorisations as precarious and prohibited the offering and advertising of betting, revoking most of Law 14.790/2023.

Beyond the R$2.55bn paid collectively for the authorisations, operators paid in about R$7.5bn in share capital, according to Carlos Lima, executive president of the Brazilian Responsible Gaming Institute (IBJR). Calculations by LCA Consultoria Econômica and Cruz Consulting point to a multiplier effect of up to R$28bn on the economy. The funds went to bettor-protection systems such as CPF verification and facial recognition, integration with the Betting Management System (Sigap), and contracts with football clubs, arenas and technology suppliers.

Lima said legal certainty translates into the predictability needed for long-term investment, and that companies structured complex operations planned for amortisation over 60 months. He said agreements designed to last five years would be interrupted abruptly on 25 October, without time for maturity or return on investment. A survey by the National Association of Games and Lotteries (ANJL) found that more than 3,500 workers were dismissed in the first 14 days of the measure's validity.

The IBJR said the early extinction of a paid authorisation without repayment could widen the perception of risk among investors in other regulated markets, where companies in sectors such as telecommunications, airports and ports also pay for the right to operate for defined periods. An LCA survey indicated that the prohibition puts at risk up to R$73bn in revenue between 2027 and 2030.

A provisional measure has force of law from publication but lapses if Congress does not approve it within 60 days, extendable by an equal period excluding parliamentary recess. As of 23 October the joint committee responsible for analysing the measure had not been installed. From 9 November the measure will block the agenda of the chamber in which it is being considered. Excluding recess, Congress has until early March 2027 to vote on it. Lima said that if Congress rejects the measure after 25 October, the activity could regain a legal basis but the status of authorisations already extinguished would remain open, asking how the regulatory process would stand and whether a new authorisation payment would be required.

The IBJR said the extinction of authorisations disconnects the unified self-exclusion database and the mandatory limit locks operated by companies, leaving the state without real-time visibility of user behaviour. The measure keeps the obligation to send operational data to Sigap until activities cease. More than 1 million bettors were registered in the self-exclusion system by July 2026, and in 2025, according to the SPA, 25.2 million people bet on authorised sites, all identified by CPF.

The study Fora do Radar 2.0 by LCA Consultores, commissioned by the IBJR and based on research by Instituto Locomotiva, estimated that the illegal market's share of the sector fell from a range of 41% to 51% in 2025 to 38% to 44% in the first half of 2026. After authorised sites and apps went offline on 6 October, Legitbet, ANJL's monitoring tool, identified 221 new clandestine addresses between 9 and 12 October, bringing the total of irregular pages accessible in the country to 30,844. Lima said such operations pay no taxes in Brazil, require no identity verification or facial recognition, offer no self-exclusion tools and operate outside the reach of Coaf and the Federal Police, adding that some sites copy the names and visual identities of brands that operated legally, with fraudsters posing as them.

The IBJR and ANJL are the plaintiffs in Direct Action of Unconstitutionality (ADI) 8.027, filed with the Supreme Federal Court (STF) on 28 September. The action seeks suspension of the measure until a new public hearing is held or Congress deliberates. The Attorney General's Office (AGU) also proposed a hearing but argues the measure should remain in force until then. The rapporteur, Justice Luiz Fux, has not yet decided on the request for an injunction, and no date has been set for judgment. The IBJR said the delay makes it harder to contain further dismissals and gives clandestine platforms more time to absorb demand previously served by the regulated market.

If a hearing is held, Lima said the institute plans to propose stricter measures, including automatic deposit limits per CPF, mandatory pauses after continuous use, risk warnings in advertising and blocking of IP addresses, DNS and payment methods linked to unauthorised sites. He said regulated companies accept and defend continuous strengthening of the regulatory framework, which he described as the only way to protect consumers without directing them to illegality. Operators also remain obliged to keep registrations, transaction histories and access records for at least five years under article 10 of the measure.