Brazil has recently taken steps to block gambling websites that are deemed “irregular” as new legislation is set to take effect at the beginning of 2025. This move comes in response to concerns over gambling addiction in the country.
In Brazil, most forms of gambling, such as casinos and slot machines, are illegal. However, online gambling was legalized in 2018, leading to a significant increase in the number of people participating in online betting. It is estimated that over 52 million people have started betting online in the last five years.
Currently, there are almost 100 companies operating 210 gambling websites in Brazil. These companies are required to demonstrate their willingness to comply with the new legislation and must renew their license applications by the end of the year to remain active. Some companies that are not authorized to operate in Brazil have chosen to take their cases to court, while others are hoping to continue operating if they are granted approval from the federal government before the legislation takes effect in 2025.
Under the new legislation, companies that wish to continue operating in Brazil must meet two strict requirements. First, they must pay 30 million reais (equivalent to US$5.3 million). Second, they must adhere to federal regulations aimed at preventing fraud, money laundering, and abusive advertising practices to maintain their business operations.
Authorities in finance and health sectors have raised concerns about the rise in gambling addiction and associated costs, highlighting the need for more regulation in Brazil. There are worries about welfare benefits being used for gambling purposes. President Lula of Brazil has threatened to ban online betting if the regulation is not effective in addressing addiction issues. He emphasized the negative impact of gambling turning into a disease or addiction and leading people to become dependent on it.
On the other hand, media companies and soccer clubs in Brazil have seen a significant increase in sponsorship from betting companies. It has been reported that almost all the clubs in Brazil’s top soccer division are sponsored by betting companies. Sports executives have appealed to the federal government to allow these sponsoring companies to continue operating, citing concerns about losing valuable revenue if the companies are permanently blocked.
Overall, the gambling industry in Brazil is facing increased scrutiny and regulation as the government takes steps to address concerns about addiction and related issues. The new legislation set to take effect in 2025 will require companies to comply with stringent requirements in order to continue operating in the country.