Legislation
Brazil – Brazil’s interim Government to privatise online sports betting
By Phil - 12 July 2016
Brazil’s interim President Michel Temer is looking at ways to legalise online betting and instants run by the largest state owned bank – the Caixa Econômica Federal (CAIXA).
According to local daily Folha, the government would allow foreign companies to work in partnership with CAIXA to operate sports betting.
The privatisation of instants would be a logical step as the government takes an increasingly liberalised stance on gaming. According to government sources, the privatisation of instant tickets would generate revenue of between R$2.2bn and R$4bn a year while annual revenue for the government would stand at around R$1bn.
Under present plans now being studied in the Ministry of Finance, and already under way before impeachment proceedings began against Dilma Rousseff, a private company would be permitted to develop the business after an initial public offering (IPO) or after a licence tender process was carried out. While CAIXA would still retain the monopoly over lottery gaming the complete operation of instants would move to a single company or consortium of private companies, which can be made up of both national and international companies.
Meanwhile, online gaming under current plans now being developed by the Ministry of Finance would be restricted to sports betting. Licence holders would be given the right to run online sports betting for ten to twenty years in order to maximise resources gathered for the state.
The news comes at a time when the Senate is poised to vote on a new gambling act. Ministers for Brazil’s interim president, Michel Temer, will continue with plans to legalise gambling in order to increase revenue for the state and gambling has been earmarked amongst three other major policy changes as an urgent priority by the President of the House, Senator Renan Calheiros. The new act, however, does not address the issue of online gaming.
Brazil offers a huge and as yet untapped market when it comes to sports betting. Sports betting remains banned under Brazil’s gaming laws and the only legalised form of sports betting (apart from a small number of Codere horse race betting shops) is via lottery type games offered by CAIXA. This is nowhere near enough to meet demand and Brazilians have been tuning to offshore gambling sites in increasing numbers. Although online gambling is currently banned in Brazil it is estimated that Brazilians gamble around US$600m a year via offshore sports betting sites.
