Brazil’s Supreme Federal Court has heard competing arguments over Provisional Measure 1.394/2026 as the government defended its decision to prohibit betting while industry groups and football organisations pushed for the regulated market to return.
Justice Luiz Fux opened the November 3 public hearing after choosing to gather further evidence before ruling on a request from the National Association of Games and Lotteries and the Brazilian Institute for Responsible Gaming to suspend the measure.
“In a judge’s car, reason rides in the front seat and passion in the back.”
Fux said the hearing would allow the court to consider arguments that emerged after the litigation began.
“The process is not a one-sided dialogue, but a participatory democratic process,” he said, adding that he is “listening to society to add arguments that came later.”
The measure, signed by President Luiz Inácio Lula da Silva on September 25, ended the regulated betting market and is also awaiting congressional consideration. Congress faces an initial November 23 deadline to address the provisional measure.
The Supreme Court hearing did not result in an immediate decision on whether the ban should remain in force.
Government Defends Ban on Consumer Protection Grounds
Representatives of the federal government argued that the prohibition was justified by the financial, health and social consequences associated with betting.
Justice Minister Wellington César Lima e Silva described betting platforms as an “architecture of unspeakable dependency” and argued that government intervention was both relevant and urgent.
Attorney General Jorge Messias acknowledged the work carried out under the previous regulated system while maintaining that stronger action had become necessary.
“Recognising this effort does not oblige us to close our eyes to its limitations,” he said. “Reviewing a policy in light of its results is the responsibility of the State.”
Messias argued that the previous framework had become “materially unconstitutional due to insufficient protection of constitutionally protected assets”.
Fux also recalled arguments concerning gambling harm during his opening remarks. He had previously addressed the effects of gambling in another Supreme Court case and again expressed concerns about how betting can affect consumers.
At the same time, he outlined the constitutional objections raised against the provisional measure. These include legal certainty and protection for contracts concluded under the regulatory system that existed before the ban.
Fux also referred to questions over whether the government had demonstrated sufficient urgency to justify using a provisional measure when gambling policy was already under legislative discussion.
He explained that delaying judicial action during the presidential election had prevented the court from appearing to influence the political process.
“Sometimes the Court has to decide not to decide.”
Industry and Football Clubs Warn of Economic Impact
Industry representatives asked the court to preserve the regulated market while introducing stronger safeguards where necessary.
“The country, through its Congress, opted for regulated gambling,” said IBJR representative Celso Mori. “But it didn’t happen overnight. It was after years of legislative processes.
“Now, suddenly, you change that orientation. Now you want clandestine and irregular gambling.”
Football clubs also focused on the financial consequences of the shutdown.
Flamengo vice-president Flávio Willeman said around R$430 million in annual revenue and more than 1,200 jobs could be affected.
The club has sponsorship agreements that were signed while regulated betting was legal. Its current arrangement with Betano is worth R268.5 million annually be for e performance bonuses and totals R895 million through December 2028.
Willeman called for “respect for the legal certainty of those who trusted legislation debated in Congress, approved by Congress and regulated by the federal government.”
“How will Flamengo and every club honour commitments due early next year with this abrupt withdrawal of regulation?” he asked, as NEXT.io reports.
Fluminense raised a separate fiscal concern. Its representative Matheus Reis e Montenegro cited Federal Revenue Service data showing the betting sector paid R$11 billion in taxes from January through September 2025 and questioned how that revenue would be replaced.
The Brazilian Association of Radio and Television also challenged the sudden reversal of the previous policy.
“It was a pragmatic choice that recognised the sector’s risks without handing the market over to illegality and organised crime,” Gustavo Binenbojm said of the regulated framework.
Safeguards Proposed as Alternative to Full Prohibition
Several participants presented measures that could accompany a reopening of legal betting.
The Economic Regulation Laboratory at the State University of Rio de Janeiro proposed eight conditions, including restrictions on financing bets through credit-funded Pix transactions and a global betting limit connected to each taxpayer identification number.
It also called for stronger self-exclusion controls, checks involving social-benefit recipients and auditable records in Brazil’s Betting Management System.
Other proposals covered advertising restrictions and dedicated funding for gambling prevention and treatment.
“If the Provisional Measure is maintained, we propose a transition with defined tasks and verification of results,” said UERJ representative Marcello Trindade Paulo.
He suggested a phased process with milestones after 180 and 360 days to account for existing contracts, workers and regulatory systems.
The Brazilian Paralympic Committee also supported betting and age limits, together with greater responsibility for operators to identify potentially compulsive gambling behaviour. Corinthians offered football clubs as partners in education campaigns addressing addiction and illegal betting.
Fux has not set a deadline for a decision. If he issues an individual ruling, the full Supreme Court would later have to confirm or overturn it.
Congress is considering the provisional measure in parallel, leaving the future of Brazil’s betting market dependent on both judicial and legislative action.