From regulation to ban: how Brazil reversed course on igaming in two years
A look back at the legislative twists, tax debates and political pressures that led to Lula’s abrupt shutdown.
Key takeaways:
- The sector was legalised in 2018 under Michel Temer and fully regulated by Lula’s government in December 2023.
- Provisional Measure No. 1,394/2026 banned fixed-odds betting and online casinos with immediate effect on September 25, 2026.
- Lula cited household debt and gambling-harm-related issues as key drivers, despite previously championing regulation for tax revenue.
- The measure must be ratified by Congress within 120 days to remain in force, leaving the market’s future uncertain.
Special report.- Brazil’s online betting and casino market was banned last Friday (September 25), less than two years after the federal government enacted the very laws that legalised and regulated it. The abrupt reversal, formalised through Provisional Measure No. 1,394/2026, marks the end of a turbulent legislative journey that began in 2018 and intensified throughout 2026 amid election-year pressures and growing concerns over gambling-related harm.
The decision by President Luiz Inácio Lula da Silva (PT) caused a major stir across the country, mobilising companies that had invested in the sector, football clubs sponsored by betting companies, supporters of the ban and representatives of the regulated market. The issue has also gained prominence in the national debate in the run-up to the presidential elections. The measure was adopted less than three years after the federal government itself enacted Law No. 14,790/2023, which laid the foundations for the regulated fixed-odds betting market in Brazil.
In light of this change of direction, a series of questions arose. Why did the government not ban betting earlier? Why did it regulate the sector only to reverse its decision? Is the decision politically motivated? What will happen to the companies that invested millions of reais to operate legally in the country?
To understand how Brazil reached this point and to seek answers to these questions, it is necessary to revisit a process that began back in 2018. Since then, the country has seen the legalisation of sports betting, the expansion of digital platforms, the creation of oversight and taxation rules, and a growing debate about the economic and social impacts of the activity.
The start of legalisation in 2018
Sports betting was legalised in Brazil in 2018 under Law No. 13,756/2018, which was enacted during the administration of then-President Michel Temer. The legislation authorised the operation of fixed-odds betting within Brazilian territory, but did not establish a comprehensive set of rules for the operation and supervision of companies. At the time, it was stipulated that the federal government would have a period of two years, extendable for an equal period, to regulate the activity.
Responsibility for completing this process subsequently passed to the government of then President Jair Bolsonaro. However, the regulations were not finalised during his administration, even after the deadline set out in the legislation had passed.
Therefore, the country remained without a fully implemented federal system for the authorisation, monitoring and supervision of operators. During this period, igaming platforms expanded their presence in the Brazilian market, serving consumers mainly through offshore websites.
Lula’s government begins regulation in 2023
After winning the 2022 presidential elections, Lula took office for his third term in January 2023. Under the leadership of the Ministry of Finance, headed by Fernando Haddad, the government set the regulation of the fixed-odds betting market in Brazil as one of its objectives.
As well as the need to set out rules for how companies operate, the regulation was also seen as an opportunity to boost federal tax revenue.
Throughout the first few months of that year, the Ministry of Finance held discussions with representatives of betting companies, authorities and experts to draw up the regulations governing the activity. These discussions resulted in the publication of Provisional Measure No. 1,182 on July 24, 2023.
The initial proposal differed in several respects from the final legislation that was subsequently enacted. Up to that point, online casino games were not expressly covered by the text, whilst Minister Fernando Haddad had proposed a tax rate of 18 per cent on gross gaming revenue (GGR), an indicator corresponding to operators’ gross gaming revenue.
During discussions about the regulations, the federal government also worked with its supporters in the National Congress to help get the proposal approved.
Haddad advocates regulation and highlights revenue potential
During an interview on the talk show “Canal Livre”, which is broadcast on the Brazilian free-to-air television network Band, in September 2023, Fernando Haddad analysed the economic impacts of regulating sports betting and online gambling. He also highlighted the importance of the state creating mechanisms to combat gambling addiction.
In the interview, the minister argued that the expansion of digital technologies had brought about significant changes in people’s habits, making it necessary to recognise the existence of the market and establish rules for its operation.
“The digital world has brought about such a huge change in people’s habits that it is difficult, given the global computer network, to prevent someone from placing a bet. How are you going to stop someone from accessing a website and placing a bet?” asked the minister.
According to Haddad, the state should regulate gambling activities and develop mechanisms to prevent gambling-related harm.
‘If the state turns its back on this issue and pretends it does not exist, it will cause harm to the population. The right thing to do is recognise the issue and regulate the gambling sector to prevent people from becoming addicted and to stop those who already gamble heavily from betting more. All of this is monitored abroad. They monitor people, and often they receive treatment,” he said.
The minister also addressed revenue expectations from the regulated market. According to him, revenue collection should exceed the projections initially considered by the government.
“Next year will be more than I imagined. The draft bill we submitted does not even include R$1bn because the Federal Revenue Service is very conservative when forecasting revenue in the budget. We estimated R$700m (US$ 140m) and respected the Revenue Service’s autonomy. But it will yield much more than that figure.”
After months of discussions, the National Congress approved the proposal that resulted in Federal Law No. 14,790, which was enacted on December 29, 2023.
The final text established an allocation of 12 per cent of operators’ revenue after the deductions provided for by law, a percentage lower than the 18 per cent initially proposed by the government. The legislation also came to cover online gambling, broadening the scope of the regulated market.
The drive to bring companies into compliance in 2024
The year 2024 was devoted to implementing the rules set out in the new legislation. One of the key steps taken by the Ministry of Finance was the creation of the Secretariat for Prizes and Betting (SPA), responsible for regulating, authorising, monitoring and inspecting companies.
This period was marked by the publication of ministerial orders setting out technical and operational requirements for the operation of platforms, covering betting systems, security, payment methods, anti-money laundering, responsible gambling and advertising.
Companies wishing to operate legally in Brazil were required to submit the necessary documentation to obtain federal authorisation, as well as to demonstrate their economic and financial capacity and meet the technical requirements set by the regulatory body.
Once the required steps had been completed, operators had to pay a licence fee of R$30m for a five-year authorisation, permitting the operation of up to three commercial brands.
By the end of 2024, dozens of companies had made progress in the regularisation process, preparing to commence operations in the regulated federal market in January of the following year.
Platforms that did not obtain authorisation were barred from operating legally in the country.
Lula begins to admit the possibility of a ban
Even after the government had worked towards the approval of legislation regulating betting, President Lula began to express concern about the social impacts of the activity and to admit the possibility of a ban.
On October 6, 2024, the president said that, although it was not his initial intention, he might put an end to betting in Brazil if the regulations failed to produce satisfactory results.
On that occasion, Lula said that it would be necessary to assess what benefits the sector could bring to society.
“We are regulating [betting], and still in October we are going to take down at least 2,000 betting websites in this country, and then we will see what benefits the regulation will deliver; rest assured that this is being done seriously. If the regulation does not yield results, I will have no hesitation in putting a definitive end to it. No hesitation whatsoever,” the president said, according to a report published by Poder360.
Lula also expressed concern about issues related to compulsive gambling, citing cases of people who had squandered their assets and income on betting.
“I know people who have lost their homes, I know people who have lost their cars, I know people who used to spend their entire wages on a Friday and Saturday. That’s not just a gambling addiction; it’s an illness that we must also treat from a health perspective. And speaking of the regulations, they should be fully ready by next week. Let’s see the outcome. If it doesn’t work, we’ll put a stop to it,” he said.
The president acknowledged, however, that a potential ban would not completely prevent the public from continuing to gamble. To illustrate this, he mentioned the persistence of other prohibited practices in the country.
“You’ll never stop the Brazilian people from gambling. In this country, cockfighting is banned, and yet you know it still goes on. In this country, the ‘jogo do bicho’ is banned, and everyone knows that people go to buy bread and place a bet, even on the bread wrapper. I don’t want to stop people from betting, because all over the world people like to bet,” he emphasised.
The statements represented one of the first public signs that the government might reconsider the market’s future, even after having worked towards the approval of the legislation that established its rules.
Brazil officially launches the regulated federal market
January 1, 2025, marked the effective launch of the regulated federal fixed-odds betting market in Brazil. With rules now in place, authorised companies began operating in accordance with the requirements set by the Ministry of Finance, including obligations relating to the identification of bettors, system security, the prevention of money laundering and consumer protection.
However, the introduction of regulation did not eliminate the challenges facing the sector. Throughout that year, one of the main debates focused on the need to combat illegal platforms that continued to target Brazilian consumers while evading the obligations imposed on authorised operators.
According to a study published by the Locomotiva Institute, in partnership with LCA Consultoria Económica, illegal platforms accounted for approximately 51 per cent of the Brazilian fixed-odds betting market. The survey was carried out at the request of the Brazilian Institute for Responsible Gambling (IBJR).
Government approves gradual increase in taxation
In the second half of 2025, the Lula government also moved forward with proposals to increase tax revenue from the sector. The discussions culminated in the approval of Complementary Law No. 224, which established a gradual increase in the levy on operators’ revenue, starting in 2026, when the rate rose from 12 per cent to 13 per cent. The legislation also provided for further increases in subsequent years, with the rate rising to 14 per cent in 2027 and 15 per cent in 2028.
The change was approved less than a year after the regulated market came into effect, at a time when companies were still consolidating their operations in line with federal requirements.
The first year of regulation ended with more than 180 authorised websites in the country and approximately R$22bn in GGR, according to the figures presented in the survey used in this retrospective.
In 2026, the social and economic impacts broaden the debate on betting
Throughout 2026, the discussion surrounding the betting market increasingly centred on its impacts on public health and the household budgets of Brazilian families. Studies and surveys cited in the public debate highlighted the social costs associated with gambling-harm-related issues, whilst legislative proposals began to discuss additional consumer protection measures and restrictions on advertising.
Against this backdrop, President Lula stepped up his criticism of the market and began to publicly advocate for a ban on certain forms of betting.
January – Lula criticises the expansion of betting platforms
On January 16, during an event in Rio de Janeiro marking the 90th anniversary of the introduction of the minimum wage in Brazil, Lula criticised the growth of betting platforms and their presence in football and advertising.
“Betting is taking over football, taking over advertising, taking over corruption in this country. You are seeing the Central Bank’s efforts to ensure that these people at least pay tax,” said the president.
On that occasion, Lula also compared the expansion of online betting to the long-standing debate over the ban on land-based casinos and the “jogo do bicho” in Brazil.
“For a long time I heard the argument that casinos were banned. Casinos are games of chance; they’re not allowed because the poor will spend their money on them. Brazil wasn’t even allowed to have the “jogo do bicho”. Now, what has happened? Casinos have found their way into our homes with all these betting platforms that have been set up,” he said.
Three days later, during an event in Rio Grande do Sul, Lula again criticised online gambling and blamed the government of former President Jair Bolsonaro for the expansion of digital betting platforms.
“I am a Catholic, and so are the Evangelicals; for a long time, we were against games of chance. I remember that the ‘jogo do bicho’ is still a crime today, yet everyone plays it. We’ve always been against casinos, on the grounds that casinos involve games of chance. What happened under the previous government? They brought casinos into our homes, so that our children use our phones to gamble all day long; we see nothing else on television but gambling with these betting apps,” he said.
The president also expressed concern about the ease of access to gambling via mobile phones and the strain this places on household budgets.
“People are spending money they don’t have on their mobiles. We banned people from going to casinos, but the casino has come into our homes. And we’re going to have to regulate these things. When we banned mobile phones from schools, it was a lifesaver for the schools,” he added.
March – President calls for a ban on online casinos
Less than two months later, on March 7, Lula returned to the subject during a nationally broadcast address marking International Women’s Day. On that occasion, the president called for a ban on online casino gambling in the country and said that the government intended to engage in dialogue with MPs and senators to draft legislation that would prevent such operations from continuing.
“A tragedy affecting Brazilian households is gambling addiction. Although the majority of addicts are men, it is the women who bear the brunt. It is the money for food, rent and the children’s schooling that vanishes onto the mobile phone screen,” he said.
Lula also questioned the difference in treatment between physical gambling establishments – which are banned in Brazil – and online gambling formats authorised under fixed-odds betting legislation.
“Casinos are banned in Brazil. It makes no sense to allow ‘Jogos do Tigrinho’ to enter people’s homes, plunging families into debt via their mobile phones,” he said.
“We will work to bring together the Government, Parliament and the Judiciary to ensure that these digital casinos do not continue to plunge families into debt and destroy homes,” added the President.
April – Lula steps up criticism and admits betting firms could be shut down
The following month, during an interview with the ICL Notícias channel, Lula once again called for the closure of betting companies in Brazil. The president expressed concern about the rise in public debt and the impact of compulsive gambling on public health.
“If it were up to me, we’d shut down the betting sites,” he declared, emphasising that the decision would also depend on the National Congress.
In the interview, Lula criticised the sector’s growth and said that the activity could cause social problems.
Lula changes his tone and distinguishes between authorised companies and illegal platforms
Later, whilst appearing on the programme “Sem Censura”, broadcast by Empresa Brasil de Comunicação (EBC), Lula once again criticised online gambling companies. This time, however, the president drew a distinction between operators acting within the law and those operating clandestinely.
Whilst reaffirming his opposition to the expansion of gambling, Lula admitted the possibility of allowing certain companies to continue operating, provided they complied with legal requirements.
“You have to know which betting operators are legitimate and which are not. You can allow one or two to continue operating, but what you cannot allow is for ‘the little crooks’ to operate,” he said.
The president also noted that he intended to address the issue during the election campaign and argued in favour of shutting down companies which, in his view, did not provide services of benefit to the country.
“I’ll say this during the election campaign. I’m in favour of putting an end to all those betting firms that aren’t providing any services of benefit to this country. Everyone must be treated on an equal footing. What is illegal in everyday life must also be illegal in any other context,” added Lula.
In the same interview, the president acknowledged that certain sectors, such as football clubs, were financially dependent on sponsorship deals signed with betting operators.
On the other hand, he expressed his disagreement with the volume of advertising by these companies in the media and said that he intended to impose new restrictions on the promotion of their activities.
When commenting on the difficulties in pushing through legislative changes, Lula highlighted the need for dialogue with the National Congress.
“I only have 70 deputies out of 513. I only have 9 senators out of 81,” he said.
According to the president, the influence of betting companies on the legislature also posed an obstacle to the adoption of more restrictive measures.
“It is well known just how much influence betting companies have in the National Congress. It is well known just how much money they make people spend on gambling without any guidance,” he said.
“It’s not up to me; I don’t own Brazil. Just as I say that Trump doesn’t own the world, I don’t own Brazil; I am the President of the Republic. I am part of a triad of institutions that govern the country. I have the National Congress and I have the Judiciary,” added Lula.
September – football clubs react to threats of a ban
As the presidential elections drew nearer and Lula’s rhetoric against betting hardened, the debate over the future of the market took a new turn. The president’s statements prompted football clubs and state football federations to speak out publicly on September 17 through a joint manifesto in defence of maintaining the regulated fixed-odds betting market.
The document was signed by major Brazilian football clubs, including Palmeiras, Santos, São Paulo, Corinthians, Botafogo, Flamengo, Fluminense, Vasco, Sport and Cruzeiro. The manifesto was also endorsed by the football federations of Rio de Janeiro (FERJ) and São Paulo (FPF).
In the document, the organisations acknowledged the social impacts associated with the expansion of betting in Brazil, but argued for the improvement of regulations rather than a complete ban on the activity.
“It is essential to improve measures relating to protection, supervision, education and prevention in order to reduce risks and ensure a responsible market. Brazil has chosen to tackle this challenge through regulation. The regulatory framework has established strict rules for companies authorised to operate in the country, with clear provisions that enable the State to oversee the market, hold those who breach the law to account and combat the activities of illegal platforms,” reads an extract from the statement.
The clubs also highlighted the economic importance of sponsorship contracts signed with operators, arguing that a potential ban could jeopardise the funding of various sporting activities.
“Investment from authorised betting companies has become one of the sport’s main sources of revenue. These funds also reach smaller clubs, lower leagues and competitions with less commercial exposure. These revenues are essential for maintaining administrative structures, training centres, staff, social projects and departments that do not generate sufficient funds to sustain themselves independently, such as parts of women’s football and the development of future talent – the first investments to be threatened when revenue falls sharply,” the manifesto reads.
Lula counters the clubs’ stance
In response to the statement from the sports organisations, Lula described as a “lie” the claim that the closure of betting companies’ operations would spell the end of Brazilian football. To support his position, the president cited the Brazilian national team’s five World Cup victories, all of which predate the expansion of digital betting platforms in the country.
“The Brazilian national team were champions in 1958 without betting, they were world champions in 1962 without betting, they were world champions in 1970 without betting, they won their fourth title in 1994 without betting and their fifth in 2002 without betting,” he said.
Lula went on to add: “Since betting began, we haven’t won another World Cup. So it’s a lie to say that banning betting will spell the end of football.”
The exchange of views between the president and the sporting bodies has intensified the debate over the role of betting operators in the funding of Brazilian football and the potential economic impacts of a possible ban.
Lula addresses criticism of betting in his UN speech
On September 22, during the 81st United Nations (UN) General Assembly in New York, United States, Lula once again addressed the betting market. Commenting on the expansion of betting platforms, Lula linked the activity to household debt and the problems arising from compulsive gambling.
“The billion-dollar betting industry turns addiction into profit. Its rapid spread is plunging families into debt and destroying homes. Brazil will not tolerate this business model. We have passed some of the most advanced legislation in the world to protect children, teenagers and women in the digital environment,” said the president.
The demonstration took place just three days before the announcement of the provisional measure that would ban the betting market in Brazil.
September 25 – Lula announces ban on fixed-odds betting in Brazil
Following months of critical statements about the sector, discussions on possible restrictions and protests by industry bodies, President Lula announced an immediate suspension of online gambling in Brazil.
The decision was formalised through Provisional Measure No. 1,394/2026, representing a significant shift in the trajectory of a sector that had been legalised in 2018 and regulated by Lula’s own government in 2023.
The ban has also sparked a new debate regarding the future of companies that invested millions of reais to obtain federal authorisation, the impact on commercial and sponsorship contracts, and the consequences of the measure for the fight against illegal platforms.
Although it has had the force of law since its publication, the provisional measure still requires consideration by the National Congress to be definitively converted into law. Members of the Chamber of Deputies and the Senate will be able to debate its content, propose amendments and decide whether to retain it. Should it not be approved within the constitutional timeframe, the provisional measure will cease to have effect, subject to the rules applicable to legal relationships established whilst it was in force.
Consequently, the future of betting in Brazil remains subject to forthcoming legislative developments.
What began as an initiative to regulate a growing market and increase federal tax revenue has become one of the country’s main economic, social and political debates in 2026.
Frequently asked questions (FAQs)
- What exactly did President Lula ban on September 25, 2026? President Luiz Inacio Lula da Silva’s provisional measure prohibited the operation, offering, intermediation and advertising of fixed-odds sports betting and online casino games nationwide. The ban applies to both domestic and offshore platforms targeting Brazilian users.
- Does the ban affect licences already paid for by operators? Yes. The provisional measure revokes all federal authorisations granted under the 2023 framework, including licences for which companies paid R$30m for five-year terms. Operators must wind down operations and refund player balances by October 5.
- Why did Lula ban betting after regulating it himself? The president shifted position as, according to him, evidence mounted of rising household debt and gambling harm. The move also aligns with his election campaign rhetoric against “digital casinos” entering homes.
- Is the ban permanent or can it be overturned? The measure has immediate force of law but must be approved by the National Congress within 120 days to remain in effect. If rejected, it will cease to apply, though legal relationships formed while it was active will follow specific transition rules.
