Brazil's Attorney General's Office (AGU) has initiated legal action in the Federal Court of Pernambuco against 17 betting companies, aiming to secure compensation for damages inflicted on Brazil's Public Health System (SUS). The lawsuit estimates the total damage at BRL2.6 billion (approximately $444.3 million), with a specific request for BRL1 billion for moral and collective damages. The choice of Pernambuco as the jurisdiction reflects the Northeast region's high concentration of socioeconomically vulnerable individuals participating in high-risk gambling.
In the lawsuit, the AGU criticized the defendant companies for privatizing substantial profits generated from the bets of millions while shifting the resulting budgetary burdens from collective health issues onto the SUS and society. The AGU states, "The defendant companies privatise significant profits derived from the financial collection from millions of bettors, while transferring the budgetary cost resulting from collective illness to the SUS and to society as a whole."
Additionally, the government contends that the financial contributions mandated by law from these operators are inadequate to meet the healthcare system's costs. Currently, only 0.12% of the operators' revenue is allocated to the Ministry of Health.
For the moral damages, the AGU seeks a minimum payment of BRL1 billion from the 17 companies to account for the losses attributed to their operations. Studies indicate that the firms involved in the lawsuit comprise around 80% of the market share in Brazil.
The following companies are named in the lawsuit:
– Kaizen Gaming Brasil Ltda. (Betano)
– HS do Brasil Ltda. (Bet365)
– SPRBT Interactive Brasil Ltda. (Superbet)
– Ventmear Brazil SA (Sportingbet)
– Esportes Gaming Brasil Ltda. (Esportes da Sorte and Onabet)
– Foggo Entertainment Ltda. (Blaze)
– NSX Brazil (Betnacional)
– EB Intermediações e Jogos S/A. (Estrelabet)
– Ana Gaming Brasil SA (7K and Casino)
– OIG Gaming Brazil Ltda. (7Games and Betão)
– BPX Bets Sports Group Ltda. (Vaidebet)
– H2 Licensed Ltda. (H2 Bet)
– Pixbet Soluções Tecnológicas Ltda. (Pixbet)
– NVBT Gaming Ltda. (Novibet)
– SevenX Gaming S/A. (Bullsbet)
– NSX Betfair Brasil SA (Betfair)
– Apollo Operations Ltda. (KTO)
As part of its argument, the AGU insists that these betting companies should bear a portion of the healthcare costs incurred by the services provided by the SUS. While the lawsuit does not specify an exact amount for damages, the AGU has requested that this be established at a later time. The claim is anticipated to cover losses from the five years preceding the lawsuit and will extend for as long as the damages acknowledged by the court persist, with a projected reimbursement of around BRL2.6 billion.
The timing of the lawsuit coincides with a significant development in Brazil's betting landscape: President Luiz Inácio Lula da Silva announced a ban on licensed betting sites effective October 6. In response, the National Association of Games and Lotteries along with the Brazilian Institute of Responsible Gaming have appealed to the Supreme Court, seeking to overturn this ban.
