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05 January 2025

Brazil Enacts Stricter Regulations On Online Betting

New laws aim to safeguard consumers as betting companies become authorized to operate legally.

The regulation of online betting is set to transform the gambling scene in Brazil, coming full throttle with new rules effective from January 1, 2025. The latest protocol aims to shape the market with enhanced consumer protection, especially targeting vulnerable demographics like minors. The Secretary of Prizes and Bets under the Ministry of Finance has duly authorized 66 companies to operate under these new rules, which establish clear guidelines ensuring safer betting practices.

According to reports, these companies have collectively paid R$ 2.01 billion for operational licenses. Legal experts highlight this move as a historical landmark for the Brazilian market. Fabiano Jantalia, from Jantalia Advogados, asserts, "Isso dá mais segurança, porque caso haja necessidade de alguma ação judicial ou mesmo de uma ação de fiscalização do ministério, as autoridades judiciárias e administrativas terão um endereço físico para buscar informações," emphasizing the benefits of having traceable information on these operators.

The new regulations dictate stringent measures: gambling operators must not only secure licenses from the Secretary of Prizes and Bets but also adhere to significant stipulations. Among these, there is now a total prohibition on credit betting and entry bonuses, both measures aimed at curtailing reckless gambling behaviors. Betting operators are now obligated to identify users using their Brazilian Taxpayer ID (CPF) and facial recognition technology, which will help to create a safer gambling environment.

One of the primary impacts of these regulations, as highlighted by Felipe Crisafulli from Ambiel Advogados, is the establishment of legal recourse for consumers. "O maior impacto que a regulamentação traz para os consumidores é do ponto de vista jurídico, é a segurança jurídica," he explains. This legal framework offers consumers avenues to seek redress through established channels such as Procon, signaling a significant shift toward consumer empowerment.

Along with legal protections, the regulations obligate betting platforms to implement strict anti-addiction measures. One notable requirement is the provision of self-exclusion options for users, enabling players to voluntarily suspend their accounts to avert compulsive gambling tendencies. The protection against gambling addiction, particularly ludopathy, remains high on the agenda, showcasing the growing awareness of gambling's risks.

Yet, there is growing concern about the influence of betting ads, especially among youth. The Ministry of Finance has acted decisively, prohibiting betting advertisements during youth sporting events, including the Copa São Paulo de Futebol Júnior. Clubs have reportedly covered sponsorship logos with tape, highlighting the conflicted nature of commercial interests and responsible entertainment. The rules stem from the general insistence on promoting responsible gaming practices, which restrict advertising targeted toward minors, as per the 2024 portaria governing gaming policies.

Critics argue, like Macaé Evaristo, the Minister of Human Rights and Citizenship, who asserts the current situation is unsustainable. She states, "O que se tem, ao menos por enquanto, é um estímulo constante para tomada irracional de decisão," pinpointing the challenge the government faces against relentless gambling promotions flooding popular media. Evaristo's comments resonate with widespread fears about gambling addiction and its societal toll, particularly among vulnerable populations.

Calls for broader bans on betting advertisements hasten as sports betting becomes omnipresent on major platforms. Luiz Augusto Santos Lima, subprocurator-general of the Republic, called for preventive measures similar to those already established to restrict advertising for tobacco and other harmful products. He implies, "Já foi feito isso com o cigarro e outros produtos. Por que não aplicar por um princípio de precaução nesse ambiente?" highlighting the need for proactive regulation before significant social damage occurs.

Undoubtedly, the legislation and guidelines introduced for online betting signify a pivotal step toward safeguarding consumers and mitigating the risks associated with gambling. It remains to be seen how effectively these regulations will be enforced and monitored, particularly against the backdrop of promising revenues from the gambling industry.

While the initial framework is undoubtedly progressive, the question arises whether it will be enough to tamp down the insidious influence of betting advertisements and compulsive gambling tendencies. Brazil's approach may become the model or cautionary tale for other regions seeking to manage their gambling industries. The commitment to protecting public health, particularly those most at risk, must stay front and center as the nation navigates this new frontier.