Upcoming Launch of Regulated Gambling Market in Brazil: What to Expect
Gambling and betting in Brazil has been illegal for more than 65 years already, but this will change shortly, as the country prepares for the launch of the regulated gambling market in January 2025. The government has already outlined the rules and requirements for casinos and software providers, and companies have started to apply for the licenses to operate legally in the Brazilian market. Ahead of the changes, we have consolidated all the available information to ensure Brazilian players know what to expect right from the beginning of the next year.
WHY TO INTRODUCE A REGULATED MARKET?
Shortly, having a regulated market in the country brings benefits to all the involved parties: operators, players, and, of course, government. Given how prospective the Brazilian gambling industry appeared to be in recent years, this decision was just a matter of time.
Safety for Players
Gambling and betting was prohibited in the country since 1946, but players still found a way to participate in this kind of entertainment. Still, it wasn't that noticeable until the last five years. The increase in popularity of online gambling and integration of crypto into the industry had a significant effect on the drastic rise of the number of Brazilian gamblers. As they didn't have ‘home’ options, players often visited foreign websites that offered lucrative promotions and attractive services.
However, with foreign casinos, there is always the other side of the coin: lucrative bonuses and fun often goes with unprotected rights of gamblers, potential scam, and uncontrolled gambling that might lead to addiction. Thus, introduction of the regulated market will make gambling safer for Brazilians. You can also explore this guide on how to avoid rogue casinos to be sure you are not a customer of a scamming website
Additional Income for Government
Regulated market is always about the money, as operators pay for licenses, they contribute with taxes, and players' bets remain in the country. Given how popular wagering has become in recent years and how significantly it could increase the state’s budget, the launch of the market was a no-brainer.
Clear Rules for Operators
Despite all the expenses that casinos and providers experience when entering new markets, this step also has a clear benefit for them. They have a clear picture of what is expected from them. Being licensed in the country also makes it easier for the company to convince players in its reputability. Moreover, advertising is more targeted, and it is much easier to engage new customers.
NEW GAMBLING GUIDELINES: WHAT TO EXPECT?
The final ordinance in Brazil was finally published on 31st of July, so we can now have a much clearer picture of what the regulated gambling market will look like in the country starting next year. At the same time, Brazilian players can find out if their favorite casino genres are allowed and how their wagering experience will look like.
Which Games Will Be Available?
There is good news for all video slots fans, as well as those keen on roulette and such card games as blackjack and poker. If you are still new to blackjack entertainment but willing to try it soon, this guide with useful tips will certainly be handy.
How about crash games that are so trendy nowadays? They will also be allowed to play, but under certain conditions:
- They should be random
- Their payouts should not be based on player’s skills
- Players should see clearly the minimum and maximum payout
- Data about the frequency of multiplier increase should be available to players.
There are also several specific conditions regarding games that providers should meet if they plan to operate in Brazil. First of all, the RTP should be no lower than 85% to ensure fairness to players. Actually, this easy-to-meat requirement does not require any adjustments from the majority of studios, as the theoretical return percentage is often higher than this threshold. The other condition is that the advertised maximum payout should be won at least once in 100 million players. We are already curious to see how it will work. Probably, such wins will be landed once in 100 million rounds at least.
Should Software Providers Be Licensed?
They should. The prizes and betting secretariat (SPA) has decided that those are not only casino providers, but also software developers that should be certified by the responsible authority to be able to provide their games to Brazilian players. Furthermore, this certificate should be reactivated given that some critical changes in the regulations have taken place. If games of a studio are supplied to operators via third parties, there should be a certificate of integration between two companies.
We can anticipate that this requirement will decrease the number of studios that will be accessible to gamblers from Brazil. However, those major software providers that have expansion to LATAM and further strengthening of their positions in the region among the strategic goals would certainly decide to apply for a license. There are already some big names among such studios.
How a Gaming Session Will Look Like?
The following requirements to casinos and game providers must ensure that players are no mislead or confused on any manner, namely:
- Casinos should ensure that players are informed about all the game options available. Players also should not be forced to gamble even when they have selected a game.
- The paytable should be available in each game. Furthermore, it should state potential wins as clearly as possible.
- The potential maximum payout should not be visible on the gaming screen unless this is the last win.
- All the gaming sessions should have random outcomes to make sure the operator or game provider does not manipulate the player's chance of winning in any kind.
The above-mentioned requirements are related to slots and other casino entertainment genres. However love dealer category has several specific requirements to be implemented:
- Live studios used for streaming should have sufficient control to ensure that no unauthorized people can get to the place from which broadcasting is made.
- There should be a surveillance system introduced and it should provide visibility of all live games.
- All live gaming sessions should be recorded and shown to SPA upon request (in case there are some complaints from players). Those footage should be preserved for 90 days.
Will Advertising Be Allowed?
Advertising is not banned, but there are plenty of restrictions that casinos should follow to be compliant with the requirements of the legal market. Thus, all promotional activities should be done in accordance with responsible practices to ensure advertisements do not trigger gambling addiction problems and spread responsible gambling awareness. This means that advertising should not be ambiguous and clear language should be used. It means no statements about probability of winning, no focus on a possibility of chasing losses,
Moreover, minors should be protected and not influenced by promotions. Thus, operators cannot sponsor children or adolescents as promoters under any circumstances. Same is true for those players who seem to already have gambling addiction issues. If any users have been banned from gambling or they asked for self-exclusion, advertising materials cannot be sent to them. That is actually a common practice in countries with regulated gambling markets to introduce such kind restrictions into their betting legislation.
Will There Be Any Other Responsible Gambling Practices?
All operators should emphasize that gambling might be addictive and spread awareness about potential risks it might carry. Moreover, casinos should introduce educational campaigns targeting potential gamblers and those at risk categories. Customers of all the operators licensed in Brazil should be informed about the possibility of financial loss during the registration process.
At the same time, effective mechanisms for self-exclusion should be available to players. It means that they should have a possibility to initiate a cool-off period, block usage of a website, take pauses, or even activate a long-term self-exclusion. Moreover, they should have access to the information about
gambling addiction treatment and contacts of the organizations that can help with this.
How Will Sportsbook Look Like?
Sportsbook will also see several big changes with the introduction of the regulated gambling market. Those changes are targeted at creating a safer betting entertainment for players.
First of all, influencers and celebrities will not be allowed to advertise any wagering activities from 2025. It will impact the sports betting industry as well, as many such people are currently involved in the promotion of sports wagering.
Secondly, the Brazilian government plans to fight against match fixing. It requires operators to collaborate in this aspect and report within five business days after spotting to the responsible body about match-fixing or any other illegal activity. Moreover, operators should report to the government within 24 hours whenever the amount of bets in the secondary market exceeds the amount of bets on the primary market for any sports event.
POTENTIAL CHALLENGES
The introduction of the regulated market is certainly a big thing for Brazil, as this thriving industry can bring significant income to the budget. Therefore, the body responsible for outlining rules and requirements should be quite thoughtful about each norm to ensure it does not kill its “golden egg” gambling and betting market before its official launch.
While all the above-mentioned rules seem to be quite fair in relation to all the involved sides, the legislation also contains some controversial norms that imporse inconveniences and challenges on casino and software providers.
Headquarters in the Country
Thus, a requirement for the operating company to have headquarters in Brazil if it plans to run its services in the country seems to be quite costly. Not every operator can afford this, so there is a big possibility that small brands will not apply for the license and will not be represented in Brazil.
License and Taxation
Each operator that would be issued a 3-year gambling license should pay approximately 5.8 EUR. Again, this is not that cheap, and not every company can afford this. On top of that, heavy taxes will be imposed on the operators: they will need to pay 18% of their gross gaming revenue on top of all the taxes that other businesses pay. This total to almost 30% taxation rate.
Regarding taxes, those are not only operators that will be influenced by strict legislation. The government states that winnings from sports betting will have the same taxes as lottery wins.Again, that is also 30% of the prize.
Impact on Football
Currently, 19 out of 20 football clubs in the main league are sponsored by betting websites, mostly foreign ones. Given that those brands decide not to apply for the license, they will not be able to continue sponsoring clubs, which are heavily dependent on such sponsors. As a result, football clubs might face serious financial problems.
As the Brazilian gambling market does not work just yet, it is difficult to predict how impactful those challenges will be and how they will influence the industry that is currently highly thriving in the country. One thing is clear: regulations in gambling industry are always quite beneficial for players, so we stay optimistic about the future of gambling in Brazil!
