SPA sets hard deadline of 1 October for unlicensed operators to exit Brazil market

The Ministry of Finance of Brazil has declared that, from 1 October, it will suspend all businesses that have failed to apply for licence authorisation to participate in the forthcoming Bets market.

This hard deadline forms part of plans to launch the Bets market on 1 January 2025, under the federal framework to regulate and licence fixed-odds betting and online gambling in Brazil.

As announced: “Only companies that are already operating and have requested authorisation by 30 September 2024 may continue to operate until December 2024. By 1 January 2025, only fully compliant companies can continue operations.”

On 20 August, the federal government management office of SIGAP closed the preliminary licence application window for the Bets market, which saw 113 businesses apply for licensing.

The licence applications are currently being reviewed by the Secretariat of Betting and Prizes (SPA), ensuring that businesses meet the technical requirements of the Bets market.

Regis Dudena, General Secretary of the SPA, confirmed: “We will maintain the adaptation period until the end of December only for those who have already demonstrated that they want to act in accordance with the law, and in accordance with Brazilian rules.”

The SPA reminded applicants that full compliance and technical alignments are required with Law No. 13,756/2018 and Law No. 14,790/2023, to meet strict regulations related to fraud prevention, money laundering, and IT security, as these are regulatory measures that will be implemented from day one of the Bets launch.

Businesses qualified by the SPA must ensure a forward payment of R$30m (€4.8m) to the Ministry of Finance by the end of 2024 to complete licensing approvals for 2025.

Betting operators that did not submit a request for authorisation by the deadline will be considered illegal as of October 2024 and must cease operations. The SPA will allow unlicensed operators until 10 October to reimburse customer funds, close accounts, and exit the market.

Those who remain will be prosecuted by the SPA, Ministry of Finance, and relevant authorities for infringing Brazil’s new gambling laws.

The new measures aim to protect consumers from fraudulent and illegal activities in the betting sector and ensure compliance with Brazilian regulations.

The update further detailed that, by 30 September 2024, all authorised companies must submit details of their operating trademarks and websites during the transition period.

Regis Dudena concluded: “Many police operations involving companies that operate in the betting market in a criminal manner have come to light. This was the way we found to avoid waiting until January to start separating the wheat from the chaff.

“We want to protect the mental, financial, and physical health of bettors by preventing the activities of companies that use sports betting and online games as a means of committing fraud and money laundering.”