Last Monday, December 12th, the deadline for regulating the sports betting market in Brazil ended. After a period of 4 years, the law approved by Michel Temer did not receive the necessary attention to create a safer and more profitable market for the country.
Many debates and studies were made about the modality, and one fact was very clear: sports betting could generate essential revenue for the Brazilian economy and society – with many areas of the country being able to benefit, such as: health, education, public safety, etc. .
UOL’s Lei em Campo column recently published an article that details the next steps that can be taken after the end of this period – which leaves the future of the betting market uncertain and tax-free.
Check out the full sports betting news below.
This Tuesday (13), the deadline for regulating the sports betting law in Brazil, formally known as the fixed odds betting law, came to an end. President Jair Bolsonaro had until the end of last Monday, December 12, to sanction the text, which ended up not happening. With the non-publication of the decree, this powerful market continues with an indefinite future, free of any type of tax, and operating in the same way as we know it today.
“Law 13.756/2018 provided for a period of four years for the Ministry of Economy to regulate the activity. Having this period expired without effective regulation, the activity will continue to be explored through the loophole that we have in Brazilian legislation that allows operators based in other jurisdictions offer bets to Brazilian residents (the so-called ‘gray market’). So, in practice, nothing will change. We are facing an activity that has been legalized, but not yet regulated. Therefore, foreign operators will continue to explore a deregulated market without rules clear”, says Udo Seckelmann, a lawyer specializing in international sports law.
“The non-publication of a regulatory rule for the sports betting market should not have a major impact on the day-to-day of most operators. This is because practically all the operators that we see in Brazil today are foreigners, and even the Brazilians who operate here, they do not operate from Brazilian companies, but from companies established abroad, which do not collect taxes for Brazil and do not generate jobs in the country”, adds lawyer Rafael Marcondes, specialist in sports law and columnist for Lei em Campo.
Sports betting was allowed to operate in Brazil after the enactment of Law 13,756, signed by then President Michel Temer in 2018. The legislation, in force after publication in the Official Gazette of the Union on December 13, 2018, provided that the sector to be regulated in the next two years, with the possibility of extension for another two years. The rules of the text provided for the obligation to create an agency that would officially regulate the guidelines for the entire operation of bookmakers, since all of them operate with headquarters abroad.
In practice, without regulation, these companies operate with CNPJs from outside the country, most in offshore companies. Therefore, the activity is not supervised by Brazilian bodies, in which any legal problems cannot be resolved through the Brazilian courts.
According to some estimates, the betting sector in Brazil could collect from the regulation of BRL 5 to BRL 7 billion annually in taxes. If it is evaluated only in grants, this value can reach up to R$ 30 million per year for each company.
As of 2023, it will be up to the president-elect Luiz Inácio Lula da Silva to regulate the activity, which is gaining more and more followers in Brazil day by day.
