In a landmark decision set to transform the landscape of Brazil’s online gaming and sports betting market, the Regulatory Policy of the Prizes and Betting Secretariat (SPA) together with the ministry of finance has officially introduced new regulations, marking the first significant step in the enactment of Bill 3,626—now recognized as Law 14,790. Signed by President Luiz Inácio Lula da Silva in December 2023, the legislation comes into force as of April 18, with the unveiling of Normative Ordinance No. 615 in the Official Diary of the Union.
The regulation is a part of a broader, four-phase rollout strategy announced by the ministry of finance last week. This initial stage, which will extend to the end of April, involves the establishment of payment, technical, and security protocols to be adhered to by stakeholders in this rapidly expanding industry.
One of the central tenets of the new ordinance is the prohibition of certain payment methods for betting activities. As per the explicit directives laid out, the use of credit cards, cryptocurrencies, cash transactions, payment slips, and checks for any betting-related payment is now banned. Such restrictions aim to inject a higher level of financial control and traceability into the sector.
Moving forward, all betting transactions including stakes, withdrawals, and prize payouts must exclusively be conducted via electronic transfers. These transfers can only occur between accounts held by the bettors and the operators, provided that these accounts have been duly authorized by the Central Bank of Brazil. Moreover, operators are not permitted to accept any payments from accounts that are not officially registered to the bettor or facilitated by third parties.
Further reinforcing the oversight mechanisms, the ordinance also outlaws any participating entities from acting as intermediaries between players and operators. There exists, however, an exception for institutions sanctioned by the Central Bank of Brazil, which are authorized to offer transactional accounts on behalf of operators under certain circumstances, for instance, to enable players to correctly receive their entitled prize amounts.
The customer-centric approach taken by the regulators is reflected in their decision to necessitate virtual accounts for players. These accounts are envisioned as a transparent medium for users to access their betting history, showing details over the last 36 months, active bets, and their financial standing. With these provisions, bettors are granted the essential tools for managing their finances and betting records more effectively. It’s worth noting that these virtual accounts must not carry any interest or other financial incentives.
Risk management also features prominently in the new framework. Operators are required to mitigate liquidity risks by maintaining a financial safety net. This reserve, set at a minimum of R$5 million, must be sequestered in federal public bonds at an approved financial institution, separate from the operators’ other funds.
Today marks the initiation of these comprehensive regulations which signify just the beginning of Brazil’s commitment to fully regulate its igaming and sports betting market. Subsequent phases will see the SPA issuing fraud prevention policies, including anti-money laundering, counter-terrorist financing rules, and guidelines on the proliferation of weapons of mass destruction.
The SPA’s legislative agenda continues with the third stage entailing the publication of standards for monitoring gambling advertising practices and requisite technical security for igaming platforms. The fourth and final phase of the strategy is set to conclude at the end of July, detailing procedures for the allocation of industry contributions towards socially responsible initiatives.
This progression of regulating the igaming and betting space is a testament to the broader efforts aimed at establishing a secure, transparent, and responsible gaming environment in Brazil. As the industry gears up for these changes, all market participants are poised for a new era marked by integrity and fair play in one of Latin America’s most dynamic markets.
