Final Sports Betting Draft Decree Consultations Launched in Brazil

Brazil’s sports betting is inching closer to becoming a (formal) reality, as Ministry of the Economy’s Secretariat of Evaluation, Planning, Energy and Lottery (SECAP) officially outlined the first draft of national bill containing fixed-odds betting.

This draft also marks one final opportunity for sports betting industry companies, operators and representatives in general to suggest changes.

Finishing Touches

This decree’s draft is significant because…

…it provides an exact insight into how Brazil’s government intends to steer the market once it’s launched. For the time being, processing of license applications and regulations thereof will be a duty of Ministry of the Economy, until a designated regulatory body is instated.

1849 responses in total were gathered after a previous round of regulations talk – 600 of which were from domestic and international gaming and betting operators. These new and final talks will last until September 27th and interested parties can again submit their comments.

The Tax Distribution

As for the decree itself…

…it confirms the previously announced 1% revenue tax that operators will need to pay. The collected turnover will be distributed in this way: 0.15% of it will be sent to social security programmes, while 0.1% will go to public education (this is a revenue from land-based operators).

National Public Security Force will obtain 0.1% of the tax turnover. 0.65% will go to football clubs that give their permission for their branding to be used in purposes of betting promotions.

For the online sector, things are a little bit different – 0.1% of revenue will be sent directly to social security, public education and FNSP each. 0.7% will go to football teams. There will be an age limit of 18 years and above imposed on this vertical and consumers willing to partake.

Securing a License

Applicants interested in becoming licensed for sports betting must provide documentation that proves they were never charged with any criminal violations, or any kind of misconduct of istrative, financial or civil nature. They must also provide a full insight into the financial state of the company, as well as a financial reserve of $1.5 million.

They must also publicly declare that they have never operated illegally in any regulated market worldwide.

Operators’ executives will also be subjected to a thorough background check. A license fee of R$3 million is set, although not yet include in the decree draft yet. Land-based operators must also pay a monthly fee of R$20,000, while for online this goes up to R$30,000. Those willing to operate both land-based and online channels will pay R$45,000 per month.

Harsh Rules of Advertising

Brazil’s gambling advertising regulations state that …

…all ads must come with a written or spoken warning (or both) about gambling’s risks and dangers. Licensees will have to display these same warnings very prominently on their websites.

No misleading or false claims are allowed in ments – having any of these will be severely punished by the Government. Ads must not feature underage people or encourage risky and irresponsible behavior.

Operators must adhere to very strict customer checks and programme of staff training. Those who do not comply with all of these rules and regulations are facing either an official warning, a financial penalty of revoking of their license and termination of operations. The Government has the right to confiscate operators’ equipment and documentation.

Source:

“Brazil launches consultation on sports betting draft decree”, igamingbusiness.com, September 17, 2019.