Brazil is the largest Latin American country, being the eighth most prosperous state regarding GDP per capita. Today, nearly all the fields of Brazilian economics are proactively developing. What is happening with the gambling business in Brazil – covered by experts of Slotegrator.
Back into History
Gambling has been banned in Brazil since 1941. However, being under discussion since 1991, the gambling legislation has been slightly changed over the past decades.
Bingo halls, offering slot and bingo machines, were authorised in 2001 for a short period until 2004 and brought about BRL 61 million (USD 16.2 million) annually.
In 2012, poker was recognized as a game of skill and even a sport. From that moment on, poker clubs were cropping up across the country. In 2015, online poker also gained legal status together with state-run lotteries and horse racing wagering.
In addition, the country legalized state lotteries and horse racing wagering. The first online lottery was launched in 2016.
Discussions on the legalization of all forms of gambling, including online games, have been proceeding in the Congress of Brazil for a long time. This entails offline and online casinos, bingo, betting and Jogo do Bicho (Animal game).
Gambling in Brazil Today
By the end of 2018, the government of Brazil expects the country's coffers to receive more than BRL 3 billion (USD 800 million) only from the sale of lottery tickets. In 2017, the budget benefited USD 475 million from the lottery.
However, the shadow turnover from gambling in Brazil, according to the governmental experts, exceeds BRL 20 billion (USD 5.3 billion).
For example, the most popular Jogo do Bicho (Animal game) is outlawed. Nevertheless, its annual turnover is estimated at BRL 12 billion (USD 3.1 billion).
Online casino operators and bookmakers, despite their illegal activities in the network, are not blocked. Besides, online totalizers and virtual sports betting on Brazilian national championships are very popular among the players.
Key Changes in Gambling Legislation
Advocates of gambling argue that such bans are inefficient in the contemporary realities. It is, therefore, necessary to launch a regulated online gambling market and thus, enrich state coffers.
The issue has become especially acute in recent years as soon as the state faced a financial crisis.
The public organization, Arrecada Brasil, advocating for the legalization of gambling in Brazil, believes that the budget will receive approximately BRL 37 billion (USD 10 billion) from gambling annually.
Therefore, the members of parliament had to relaunch the issue of gambling legalization again.
In December 2015, the Special Committee on National Development (CDEN) approved a bill No. 180. It provides for the legalization of the entire gambling industry within the country’s borders.
The bill shall be approved by the National Congress of Brazil that consists of two houses: the upper is the Federal Senate and the lower is the Chamber of Deputies. Once the bill is passed by the Congress, it will be submitted to the president to be signed into law. Only then, it enters into legal force.
Over the years, the draft bill No. 186 has been actively discussed and amended by the Congress many times. However, it has not been adopted in the majority of the upper house.
The draft was divided into two parts: SPL186/2014 and SPL442/1991. The first one was submitted to the Senate, the second – to the Chamber of Deputies.
Gambling Legislative Bills
Discussions and amendments to SPL186/2014 are carried out by the Committee of the CJC (Commission of Constitution and Justice and Citizenship) of the Federal Senate of Brazil. Over the years, the Commission has made more than 70 amendments.
7 March 2018, the CCJC voting issued the latest version of SB186/2014. However, the bill was rejected again on various grounds:
- the latest version does not include the requirements of the president to create an Agency to regulate the industry;
- no final research on the online gambling market;
- anti-money laundering mechanisms are not properly thought out;
- no system of penalties for market violations;
- no recommendations for controlling VIP gaming rooms in land-based casinos.
Now the bill is waiting for the analysis of other committees and the further amendments. After that, it will be submitted to the Senate for voting.
However in 2018, there is no consideration of this bill in the schedule of the plenary agenda of the Federal Senate.
Chamber of Deputies Bill
The second part, SPL 442/1991, has been considering for over 27 years by Chamber of Deputies. This bill refers to the legalization of gambling establishments and online games in the resort areas related to the tourism industry.
But at the plenary session held on 20 March 2018, the discussion of the bill was excluded from the agenda of the Chamber of Deputies.
This means that gambling in Brazil will remain unregulated until next year.
What to Expect in the Future
Brazil is the fifth largest and sixth most populous country in the world, and the legalization of gambling will turn it into one of the most profitable regions.
Market experts cannot be a hundred percent sure that the law allowing gambling in Brazil will have been approved by Congress next year. Although it has already gained the necessary economic strength and following of the residents.
The debate in the Congress was interrupted for political reasons: the impeachment of former President Dilma Rousseff and corruption scandals around the current President Michel Temer. Therefore, process of gambling legalization will resume as soon as political tensions decline.
Large companies are already breaking fresh ground of the Brazil's gambling market. For example, Las Vegas Sands (LVS) CEO, Sheldon Adelson, recently has said that, after removing legislative restrictions, he plans to integrate casinos in Brazil. Mr. Adelson has already discussed the possibility of building the facilities worth USD 8 billion at the meeting with President Michel Temer.
Therefore, the gambling industry is preparing to gain a legal status in Brazil.