Brazil’s path back to being an appealing market for investors in the iGaming sector hinges on regulatory stability, according to Alex W Pariente. He organizes his analysis around seven critical questions that the country must address, especially in light of the expiration of licenses and the controversies surrounding Provisional Measure 1,394.
In an exclusive examination for iGaming Business, Pariente contends that legal clarity and strong enforcement capabilities are far more crucial than lower taxes or promotional opportunities that may be altered in the future. He does not take a position on whether Brazil should adopt a more liberal or restrictive model; instead, he emphasizes that the nation possesses the foundational legal and regulatory structures to revitalize the sector. The real challenge lies in maintaining these frameworks while finding sustainable solutions that can turn current crises into fresh investment prospects.
On October 25, Brazil's authorized betting market ceased to exist. The licenses issued under Law 14.790, worth BRL2.55 billion ($476.2 million) in grants, expired without offering any refunds to the investors. Currently, Provisional Measure 1.394 is still in effect. Congress has yet to form a joint committee to analyze this measure, and on November 3, Supreme Federal Court Minister Luiz Fux is scheduled to hold a public hearing to consider the views of the government, associations, and clubs regarding requests for suspension.
As international observers evaluate Brazil’s potential, Pariente notes that investment committees often focus on seven principal inquiries:
1. **Will the liabilities from Provisional Measure 1,394 be resolved?**
No leading operator will enter a market where investors are mired in lawsuits over BRL2.55 billion. Future iGaming models must start by addressing these licensing issues and the 19 ongoing legal challenges.
2. **Will changes come through legislation?**
Changes enacted through legislation, along with transitional measures and compensation rules, hold more significance. Pariente points to Spain, where the Supreme Court invalidated advertising limits that had been set by a decree in 2024, ruling that such restrictions need legislative approval.
3. **Will a capable regulator be established?**
The UAE set up its federal regulator in 2023, followed by its first license in 2024. Singapore also arranged its regulatory framework before launching resorts. Brazil already has a Secretariat for Prizes and Bets with established data and payment systems. The next step is to ensure it has a solid technical mandate and stability.
4. **Is the concession model aligned with investment timelines?**
Macau renewed its concessions in 2022 for ten years, revising investment commitments. Italy has started issuing online licenses for up to nine years. Clarity on renewal periods and rules from the outset is essential for integrated resorts.
5. **Will the tax structure remain stable?**
After Colombia established a 19% VAT on online gambling via an emergency decree, the Constitutional Court annulled it in 2026, demanding the return of collected revenue. Investors prefer a stable tax environment over a potentially lower tax that could change unpredictably.
6. **Can capital flow smoothly in and out of the country?**
With Brazil's modern exchange rate policy enacted in late 2022, investors are keen to know if the framework will apply to the gaming sector, including for profit repatriation.
7. **Who will satisfy ongoing market demand?**
According to H2 Gambling Capital, the unregulated market could expand from roughly BRL17 billion to BRL42 billion. The Philippines had to implement a specific law in 2025 to ban online gambling aimed at foreign markets, indicating the necessity for regulation to address market demand and associated costs.
These inquiries resonate with any model adopted, be it more open or restrictive, largely reflecting on the need for stable regulations. Brazil has already made some progress: the 2023 law, a regulatory body with established data and systems, a functioning exchange rate framework, and a trained workforce adept in compliance and responsible gaming. Pariente Advisory does not endorse any particular direction for Brazil’s gaming industry.
With elections concluded, the decision-making power resides with institutional bodies. For external observers, the responses to these seven pivotal questions will hold more weight than mere announcements. Positive answers could illuminate a path toward a robust market, transforming the challenges posed by the 2026 crisis into promising opportunities for Brazil.
