New details on sports betting regulation in Brazil

Sports betting in Brazil gets closer and Joga Brasil revealed new details.
Sports betting in Brazil gets closer and Joga Brasil revealed new details.

Joga Brasil shared details about the new rules for sports betting in Brazil as the industry waits for the segment to finally launch in the country.

Brazil.- Joga Brazil reported this week that the federal government already has the basis of the decree that will regulate sports betting in Brazil. At the moment, the authorities are working on the drafting of the decree that will establish said rules. In addition, they will set the tax regime and fines for those who operate illegally.

Statements

“We are structuring the draft decree. The plan is to finish it in the coming weeks and launch a new public consultation with the final document. We now have a proposal for the market,” said Alexandre Manoel Angelo da Silva, national secretary of Public Policy Evaluation, Planning, Energy and Lottery at the Ministry of Economy.

“Legislation changes are needed. The activity is not criminalised at the moment. We want to do so and include imprisonment. This is essential for the activity to operate within the best practices followed in the world,” he explained.

Sports betting rules

During a public consultation held in August, 1,849 suggestions were submitted in 30 days. The suggestions were used to establish the guidelines that will be followed regarding authorisation, taxes and penalisation of those who do not comply.

Another important decision was to establish the authorisation regime for companies to work within the segment. Only those who follow approved legislation may operate.

Authorisation fees

To operate in Brazil, companies must pay a single fee worth €660k. This licence is valid for nine years. After the deadline, the operator must pay again, an updated amount. As they explained, this is a mix between the United States and Italy model.

To put an end to illegal businesses, the government will set the tax rate at 1% of income. The market demanded that the tax regime be calculated on the gross income of the game (GGR). Taxing 1% of income is equivalent to 5% and 7% on GGR and contemplates the proposal of the private sector, according to the Ministry of Economy. This model is the same regime as Italy or England, already developed markets.

Possible fines

The federal government intends to amend the Criminal Code to impose severe penalties on illegal operators. Those responsible for illegal websites may spend up to five years in jail and face fines. Those who participate in match-fixing can also face up eight years in jail and a fine. However, the approval of Congress must approve such changes first.

Next steps

With the final version of the draft, the government will hold a public consultation for 15 days. They aim to begin discussing the proposed legislation in October. 

The segment expects President Jair Bolsonaro to sanction the Law in December. Then, a 180-day period for the federal government to set between 18 and 24 servers to monitor bets in the country.

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