International edition
September 19, 2019

According to two renowned local experts

Legalized sports betting in Brazil: what you need to know

 Legalized sports betting in Brazil: what you need to know
Magnho José, president of Brazil’s Legal Gambling Institute, and Pedro Trengrouse, coordinator of the Sports Management course at “Getúlio Vargas” Foundation.
Brazil | 12/18/2018

Brazilian President Michel Temer signed into law Monday "Medida Provisoria 846", which provides for the redistribution of part of the national lotteries’ proceeds and also regulates sports betting in the country. Magnho José, president of Brazil’s Legal Gambling Institute, together with Pedro Trengrouse, coordinator of the Sports Management course at “Getúlio Vargas” Foundation have shared their views on the Brazilian market in light of this new piece of legislation.

W

hat are the main changes brought about by Medida Provisoria Nº 846?

MP makes Apostas de Quota Fixa (fixed odds bets), which are popularly known as sports wagers, legal in Brazil.

When does it become effective?

MP's wording states that “ the operation of fixed odds bets shall be authorized or granted by the Ministry of Finance,” which, in accordance with the law, shall also have a 2-year term (renewable for two more years) to issue its enforcement rules.

Magnho José says the rules for MP's application may take at least a year. “We are starting practically from scratch. The Ministry will have to create a whole structure in order to oversee this activity and to issue MP’s enforcement rules.

Sources from the Ministry of Finance, on the other hand, have said that they are not currently able to state a specific date for these rules.

What happens with foreign gambling sites that are currently taking bets in Brazil?

It is worth noting that those sites are currently able to operate in Brazil because they are not headquartered in the country. In this way, they are subject to the regulations of their respective nations of origin.

Pedro Trengrouse believes the scenario will not change dramatically. “Operators will continue with what they’ve been doing so far. None of them will enter Brasil. This regulation will only help create cooperation bonds with Brazilian authorities for the monitoring of bets, awards’ taxation and the granting of licenses for the legal development of their activities.

However, Magnho José does expect companies will enter the country. “It is necessary to create rules under which foreign sites are forbidden from operating in Brazil, so as to encourage them to be based here instead of overseas.” These, however, are mere speculations as only when the Ministry of Finance issues the enforcement regulations will we be able to know what is going to occur."

What about other gambling modalities such as casinos, bingo halls and "Jogo do Bicho"?

All of them remain forbidden. Both the upper and lower chambers of Brazil’s Congress have pending bills on these modalities.

The proposed laws have already been discussed by different committees and now await the analysis by their respective whole Chambers. Experts believe both bills will be discussed soon.

“This issue has been extensively debated during the last four years. The Legislative, Executive and Judicial branches can no longer avoid the subject. We must move forward, Magnho José said.

“The Congress must vote in favor of legalized gambling. There is a parliamentary bloc of 260 lawmakers who support this decision,” Trengrouse pointed out.

What are the experts' opinions?

Both experts consulted believe that MP’s approval is a step forward. But, according to them, the government is “putting the cart before the horse.” Nowadays, Brasil is being invaded by sites based in other countries. The regulation of this activity enables the collections of gambling proceeds, but in all the rest of the unregulated markets, sports betting has been the last activity to be legalized.”

“This measure is only taken when a market is mature enough, and especially after the regulation of casinos and other gambling modalities. It is best to first regulate activities that are already been operated illegally, such as Jogo do Bicho,” said Magnho José.

“The Congress and the Executive should be treating the subject with responsibility, without letting other modalities aside,” Trengrouse assured.

Trengrouse highlighted other problems related to the absence of gambling legalization in Brazil, such as the exploitation of gambling by organized crime, the lack of responsible gambling policies, and the fact that the government is not collecting taxes on these activities. If the whole gambling market were legal, the country would have raised 4.591 million dollars in taxes.

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