Brazilian government moves to regulate online gaming with notable absences on initial approved operators list

Several prominent betting brands were conspicuously absent from the recent list released by Brazil’s Secretariat of Prizes and Bets (SPA), which details the operators authorized to continue their activities ahead of the anticipated launch of the country's regulated market next year.

The Brazilian government’s Normative Ordinance No. 1,475, published in September, prevents operators that had not applied for a betting license or were not already active in the market from participating in the upcoming legal framework. This regulation is set to be enforced from October 1 through December 31, with the regulated gaming market scheduled to officially open on January 1, 2025.

Upon the ordinance's deadline, the SPA announced that 89 operators had received approval, resulting in a total of 193 brands that can legally operate in Brazil until the market launch. While recognized names like Bet365, Betsson, and Aposta Ganha were included on the list, several significant players in the Brazilian betting sector were notably missing.

One significant exclusion was Caixa Loterias, a federal lottery monopoly managed by Caixa Econômica Federal, Brazil's state-owned financial services entity. Caixa Loterias expressed intentions to introduce a sports betting brand and submitted a license application ahead of the August 20 deadline, positioning it for the first round of license approvals.

However, the SPA indicated that Caixa did not have a live betting offering at the time of the ban. Caixa Loterias President Carlos Antônio Vieira previously remarked on the company's ambition to become a leading entity within the betting sector.

Operators not included on the SPA’s approved list are set to have their websites blocked by the National Telecommunications Agency (Anatel) starting October 11, following a ten-day period allowing players to withdraw their funds.

Although the SPA has not publicly clarified the specific reasons for these exclusions, UOL has reported that the absence of Esportes da Sorte may be attributed to a formal error, with the company reaching out to the SPA for rectification.

The list also omitted three operators linked to illegal gambling and money laundering allegations: Esportes da Sorte, VaideBet, and Zeroumbet. Darwin Henrique da Silva Filho, owner of Esportes da Sorte, surrendered to federal authorities on September 5 amid ongoing investigations, yet he maintained his innocence through an open letter issued prior to his arrest.

VaideBet’s owner, José André da Rocha Neto, was also apprehended during the investigation, which involved multiple law enforcement agencies, including Interpol and local police from various states.

In addition, other well-known brands such as Stake, a cryptocurrency gambling platform, and Grupo Silvio Santos (GSS), which is planning to launch its Todos Querem Jogar (TQJ) betting brand, were also missing from the approved operators list.

While Stake applied for a license before the deadline, its exclusion means it will need to wait until January 2025 to enter the market. GSS has announced a partnership with OpenBet for its TQJ brand, but like Stake, it lacks a current product offering and is still in the process of securing development financing.

Regis Dudena, the Secretary of Prizes and Bets, acknowledged the challenges faced in compiling the list of approved operators, stating that the release of the final roster was complicated by legal injunctions suspending SPA ordinances. The blocking of non-compliant websites hinges on an assessment from the Ministry of Finance, the SPA, and the Attorney General's Office due to an injunction obtained by the Federal Court.

Fernando Haddad, the Minister of Finance, criticized the notion of having a national lottery while simultaneously allowing states to regulate their own betting establishments. He expressed concerns over the feasibility of monitoring irregular betting sites nationwide. “We are not able to scan the entire internet in a short time,” he admitted.