Brazil Bans Online Betting as Lula Signs Provisional Measure

On September 25, Brazilian President Luiz Inácio Lula da Silva signed a provisional measure to ban fixed-odds betting throughout the country by prohibiting the operation, intermediation, offering, and advertising of betting. It includes sports betting and online casino games, including those licensed by state and district governments.

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The government has created a gradual plan for the closure. New deposits are not allowed right now, and existing players will be able to withdraw until 11:59 p.m. October 5. The betting websites and applications will be available for the last time on October 6, and the advertising and sponsorship will be removed by October 5.

Bettors to Receive Remaining Balances

Finance Minister Dario Durigan outlined the withdrawal process, stating: “As of today, no more money can be deposited into the country’s betting sites. The platforms will remain available so that people and bettors can withdraw their remaining balances until 11:59 p.m. on October 5.”

Remaining balances should be returned to betting operators by the banks from 9th to 14th October. The government has also said it would step up the enforcement of betting regulations by introducing measures to block unauthorized betting websites and locate bank accounts where betting operations are illegal, and curbing transfers linked with illegal betting activities.

Lula Cites Gambling-Related Harm

Lula has called the ban a measure in response to the concern about the debts generated by gambling and the effects on Brazilian households. In the announcement, he likened the spread of online betting to the early stages of the spread of crack cocaine in Brazil.

“Some things are shocking. It reminded me a little of the early days of crack in this country. Society was left completely unprotected. This country, which was against casinos and cockfighting, brought the casino into people’s homes,” Lula said.

“I made the decision to take a tough, drastic and necessary measure. It is like a tumor: either we remove it, or the tumor kills us,” he added.

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Government Targets Illegal Betting Operations

The government also stated that it plans to toughen up enforcement against illegal betting sites and money transfers associated with illegal operators. The restrictions on bank transfers for betting, identification, and closure of illegal websites, along with blocking of bank accounts used unlawfully for betting activities, are all part of the measures being taken.

The administration also intends to propose legislation to Congress that would create specific crimes in connection with the operation, promotion, and facilitation of online gambling. The proposed measures are aimed at enhancing the prevention and repression of illegal betting operations.

Provisional Measure Faces Congressional Deadline

The measure is also a provisional measure and becomes effective at once, but needs to be approved by Congress to stay in force. In Brazil, provisional measures, in general, have a validity period of 60 days subject to an automatic extension of 60 days if Congress has not finished examining them. The measure lapses in 120 days if not approved by lawmakers.

The ruling is just under two years from the enactment of Brazil’s regulated fixed-odds betting system, which was approved by Lula himself by means of Law No. 14,790/2023. The government announcement was also connected with a package of measures to combat household debt, which includes a new version of a government program known as Desenrola to refinance debt.

Regulated Industry Signals Legal Challenge

One of Brazil’s main representatives of the regulated betting industry, the National Association of Games and Lotteries (ANJL), announced it would file a lawsuit against the provisional measure.

The federal companies that were authorized to run betting and online gaming companies had already invested R$30 million in their licenses. The ban will thus create issues relating to the continuation of current licenses, the legal mechanism for the industry, and the shift from a regulated market to a nationwide ban.

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Source: SBC Noticias