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On June 7, ����žž hosted its second webinar on Brazil’s forthcoming regulated market for sports betting and online gaming. The webinar was hosted by Chief Analyst, James Kilsby, and featured a panel of two Brazilian legal experts Luiz Felipe Maia, founding partner of Maia Yoshiyasu Advogados in São Paulo, and Rafael Marchetti Marcondes, legal director of the Brazilian Institute for Responsible Gaming (IBJR) and chief legal officer for fantasy sports platform Rei do Pitaco.

The webinar was hosted two weeks after the opening of a 90-day licensing window for operators seeking to be part of a first wave of licensees due to formally launch in Brazil at the start of 2025. That window has opened, however, with just four or 11 planned regulatory ordinances published and various key policies and regulations due to be determined much closer to an August 20 application deadline. In this blog, we highlight three key takeaways from the conversation.

Key Policy Decision Pending On Online Casino Games

Brazilian regulators have yet to reassure the industry that a full range of casino games will be permitted under the guise of fixed-odds betting on virtual online gaming events, as authorised under Law 14.790 of December 2023. Industry groups are hoping that the example of Italy, which has a similar legal structure to Brazil’s and regulates online gaming under the umbrella of fixed-odds bets, will persuade the Ministry of Finance’s newly established Secretariat for Prizes and Bets  that jackpot-based games and popular crash games are permissible. The issue is a critical one that will impact how attractive the regulated Brazilian market is both for players and for operators, with some companies readying licence applications but waiting for clarity before deciding whether or not they will file them.

‘Brazilian’ Investor Requirement Clarified

The ����žž webinar was hosted less than 24 hours after one key policy question was answered favourably by the Ministry of Finance. Following several months of uncertainty, officials confirmed that a statutory requirement for operators to be at least 20 percent owned by a ‘Brazilian’ could be met both by having a Brazilian individual or by a Brazilian headquartered company. The guidance means international operators should be able to apply for a licence after establishing a local company and without needing a local Brazilian partner per se, per our expert panel.

Had the Ministry of Finance advised the other way, there was a material risk that one or more potential applicants may have challenged the requirement in Brazilian courts, with the resultant risk that an adverse court ruling could suspend the licensing process in its entirety.

Unique Compliance Challenges

The ordinances published by the Ministry of Finance to date have established several compliance requirements that are either unique, somewhat unclear, or otherwise challenging for prospective operators and their supplier partners. Among other issues highlighted on the ����žž webinar: an obligation for all prizes to be paid out by operators within two hours or a request by the player; requirements for betting systems to be based in Brazil unless in they are in a country with a formal cooperation agreement with the Brazilian government; tax laws that may make it expensive for iGaming providers to expatriate revenue earned by Brazilians playing their games offer by licensed operators.

Want to know more?

Catch the full discussion: watch the webinar recording on demand now.