The once-imminent future of Brazil’s gambling and sports betting markets is now on the back burner as the country deals with its October elections.
chose to set them aside until October had passed
Legislative committees in the Chamber of Deputies and the Senate reached an agreement earlier this year, seemingly ending debates that began in 2018. Two bills were fast-tracked to President Jair Bolsonaro and the expectation was that he would sign them into law, he chose to set them aside until October had passed, and the country’s political climate had stabilized.
Both bills are still waiting and will go before the President again once the elections are over.
Stuck in limbo
Bolsonaro already struck a victory of sorts at the ballot box, outperforming expectations and preventing Luiz Inacio Lula da Silva from securing an outright victory, thereby forcing a runoff vote. Brazil has the fourth-largest democracy in the world, and the impact of the election will have a resounding impact regardless of how it ends.
Despite Bolsonaro’s strong showing, prominent figures in the gambling industry were unenthused and unsurprised by the move to delay gambling legislation.
“Believe me…this is a very Brazilian affair,” said FBM Digital Systems, subsidiary of LatAm group FBM Gaming, CEO and Brazilian native Roberto Regianini. “[Brazil] follow[s] no conventional wisdom in its approach towards launching.”
Another problem facing the Brazilian government is the lack of clarity regarding which direction it will pick. As Regianini reiterated, just because two frameworks have been approved does not mean that either will be enacted—even if one is approved, it is unclear which is more likely as of today.
There is also concern that any further delays could have significant repercussions. According to Andreas Bardun, CEO and Founder of KTO Group, a gaming group with offices in Asia, Europe, and Latin America, Brazil must act immediately.
regulations must be established within a four-year period, or else congress must restart the process”
“The terms applied to the two Bills stated that regulations must be established within a four-year period, or else congress must restart the process,” said Bardun. “We really cannot afford to have that outcome.”
Bardun also noted that settling the future of gambling on the back of a divisive general election “could have been avoided” but will be accepted as a necessary evil if it leads to new legislation.
Future of gambling in Brazil
Brazil stands to gain tremendously if it succeeds in getting its plans for gambling over the finish line. As previously mentioned, it has the fourth-largest democracy, as well as the ninth-highest GDP, and could redefine gambling in the region.
“In my opinion, the lawmakers have not understood the opportunity of the online gambling market to reshape Brazil,” said Bardun. “It should be treated as a completely new industry that can provide new high-paying jobs in customer service, tech, payments, and business intelligence… This is what the politician’s campaigns say they want, and it should be delivered.”
The transition to a new era Bardun speaks of will take time. Although many countries are gearing up for World Cup betting near the end of November, where Brazil is the odds-on favorite to win over Kylian Mbappe and France, critics worry that Brazil will not be in a place to create a stable gambling environment.
we would recommend lawmakers focus on a Q1 launch next year”
“A Qatar [World Cup] launch is unlikely to come,” said Regianini. “We would recommend lawmakers focus on a Q1 launch next year, with time to satisfy all licensing and regulatory conditions needed.”
The country is already undergoing a regulatory review of partnerships between sportsbooks, sports teams, and media providers. The move was prompted by concerns from Secretaria Nacional do Consumidor (SENACON), translated as National Consumer Secretariat, that deals were being agreed to without federal approval of sports betting sponsorships. The next government regime will therefore also have this issue to deal with.
Brazil’s elections started on October 2 and run until October 30, when the new president, vice president, and national congress will be unveiled.
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