The Federal Government of Brazil has informed stakeholders and agencies about its imminent proposal to regulate a fixed-odds sports betting regime.
A provisional notice has been published on the government’s website, outlining the proposed rules and measures drafted by the Ministry of Finance. These measures aim to regulate Brazilian sports betting.
The proposal will engage multiple ministries, including Planning, Management, Health, Tourism, and Sports, to ensure the transparency and supervision necessary to maintain public confidence and safeguard consumers.
Key directives include the establishment of a new industry secretariat by the Ministry of Finance. This body will be responsible for approving betting companies’ accreditations and monitoring the betting volumes and revenues of the market.
Once implemented, only accredited operators will be permitted to accept wagers related to official sporting events. Unlicensed operators will face a complete advertising ban, including on digital media.
The Ministry of Finance suggests a 16% Gross Gaming Revenue (GGR) tax on gambling operators. The tax will be calculated as the “revenue obtained from all games played, minus the prizes paid to players.”
Additionally, the proposal recommends taxing player prizes at 30%, with an exemption limit of BRL 2112 (€390). Collected taxes will be distributed across sectors like public safety, basic education, sports clubs, and social initiatives.
The 16% GGR tax allocation has been predetermined, with funds set to support “various critical organizations”, encompassing public welfare, basic education, sports clubs, and social projects.
Specifically, 2.55% will strengthen the National Fund for Public Security, reinforcing efforts against match-fixing, money laundering, and other betting-related crimes. Brazilian education will be enhanced with a 0.82% share, while 1.63% will benefit sports clubs.
A significant portion, 10% of the GGR tax, will be reserved for social security/welfare projects. Meanwhile, the Ministry of Sports is slated to receive 1% of the allocated taxes.
To maintain a healthy betting environment and avert the development of gambling disorders, industry companies will be mandated to conduct awareness and prevention campaigns. These efforts aim to safeguard gamblers’ mental wellbeing by mitigating the risk of betting addiction.
Furthermore, the betting industry’s communication, advertising, and marketing rules will be established in conjunction with the National Council for Advertising Self-Regulation (CONAR). This requirement intends to encourage responsible and ethical marketing practices, contributing to a secure and well-regulated betting landscape.
The proposals will be passed on to the Chief of Staff upon endorsement. This step will enable the ministries to enact regulations and establish systems to deter and address instances of match-fixing.
However, the government’s initial proposal may conflict with the expectations of Brazil’s major football clubs, who have demanded a guaranteed 4% of betting income for the use of image and athlete rights.