The recent ban on betting in Brazil has sparked a significant debate regarding its impact on consumer protection and the potential growth of the illegal gambling market. During a public hearing at the Supreme Federal Court (STF) on Tuesday, 34 organizations discussed Provisional Measure 1.394, which implements the ban.
The Ministry of Justice reported efforts to combat illegal betting, stating it has requested the closure of 36,905 websites from September 25 to October 29. While this figure demonstrates the government's active pursuit of illegal operators, industry representatives cautioned that the ban could inadvertently foster an environment that makes enforcement more challenging by diminishing the role of licensed betting operators.
Pietro Cardia of the National Association of Games and Lotteries (ANJL) highlighted an alarming trend, noting that betting volumes had plummeted by 32% in the last three months, in comparison to the same timeframe the previous year. Furthermore, Cardia pointed out that prior to the ban, over 60% of betting activity was recorded within the regulated sector.
Udo Seckelmann, a lawyer for professional football club Botafogo, presented data indicating that 188 websites had received approval from Brazil’s gambling regulator, the Secretariat of Prizes and Bets (SPA), while authorities had blocked over 66,000 illegal sites in the past 20 months.
Industry advocates maintain that licensed operators have been instrumental in monitoring betting activities and have actively contributed to addressing issues like match-fixing and money laundering. A representative for São Paulo FC noted that regulated operators had begun identifying and reporting suspicious betting patterns, alongside efforts to educate athletes and staff about match-fixing risks and proper reporting channels.
Concerns persist that the shift towards unlicensed betting platforms could dismantle existing safeguards. Industry representatives asserted that illegal entities lack necessary consumer protection measures, and do not adhere to requirements for collaboration with sports organizations.
On the other hand, the Brazilian government defended the prohibition, arguing that the existing regulatory framework had not adequately mitigated the social and health risks associated with gambling. Minister of Justice Wellington César Lima e Silva criticized betting platforms as fostering an “architecture of dependency.” Minister of Health Alexandre Padilha presented troubling statistics linking problem gambling with increased rates of suicide, while Attorney General Jorge Messias contended that the previous regulatory model had failed to offer sufficient family protection.
Consumer spending on gambling also became a contentious issue. Ana Clara Marques de Barros Santos from Aigaming cited SPA data showing that 70% of bettors spent no more than BRL50 per month, with average betting sessions lasting only 12 minutes. This information challenged the notion that betting was intrinsically linked to high household expenditures.
Conversely, opponents from the Brazilian Association of Supermarkets (Abras), the National Confederation of Commerce (CNC), and the National Confederation of Industry (CNI) raised alarms about potential increases in consumer debt and health issues as a result of gambling activities.
The debate arose within the context of the Supreme Court’s review of Provisional Measure 1.394, which is currently being contested by the ANJL. The association has requested that Minister Luiz Fux suspend the measure while the court deliberates. Fux's decision will dictate the forthcoming course of action. A central question remains unresolved: do the risks posed by betting warrant a ban, or is a regulated market with enhanced consumer protections a more effective approach?
