Brazil appoints managers for sportsbook licensing process

Brazilian President Jair Bolsonaro has signed a decree formally adding sports betting to the country’s Investment Partnership Program (PPI) portfolio and national privatisation programme.

Bolsonaro’s decree also hands state-owned bank Banco Nacional de Desenvolvimento Econômico e Social (BNDES) and the Ministry of the Economy control of developing and running a process to select sports betting operators.

BNDES and the Ministry will begin work on developing the bidding process, which is likely to be similar to that used to facilitate the sale of instant win lottery business Loteria Exclusiva Instantânea (Lotex) in October 2019.

The decision to pursue this model was agreed in February this year, which saw plans to develop a qualitative framework, where any operator that met the licensing requirements could apply, scrapped. 

Waldir Marques, undersecretary for prizes and sweepstakes at the Secretariat of Evaluation, Planning, Energy and Lottery (SECAP) within the Ministry, said multiple operators would be allowed to enter the market, and talked up the benefits of legalisation.

“According to industry press, it is estimated that Brazilians send BRL2bn to BRL8bn abroad via international [gambling] sites, as the vertical is not regulated in the country,” Marques said.

“This indicates that the legalisation of sports betting in Brazil will provide greater security for bettors, new jobs and more income, in addition to preserving sporting integrity, which is a key condition of regulation.”

Marques added that legal wagering would also boost federal coffers through the 3% turnover tax on sports betting, included in the legislation signed into law by then-President Michel Temer in December 2018.

The country’s sports betting market was originally expected to launch before the end of 2020, though the late shift away from the qualitative model is expected to see the legal wagering go live next year.

Efforts to finalise the regulatory framework and move towards launching the concession process were stepped up in June this year, when the PPI Council included betting in a BRL37.03bn package of fundraising measures.

These are designed to create additional funding for Brazil’s economic recovery, after the country was badly affected by the novel coronavirus (Covid-19) pandemic.