Hugo Baungartner is the chief commercial officer of Brazilian online operator Grupo Aposta Ganha. He said that he expected Brazil’s market for online gambling to be 80 percent regulated by 2025, when it will have been operational.
Baungartner said, during the most recent episode of iGaming Business’ World Series of Politics Podcast, that “we know in the gaming industry, it is never 100 percent regulated but I believe [the Brazilian Government] can [regulate] a good share of market.” I believe they can cover about 80%.”
Baungartner stated that the Brazlian Government is looking into blocking operators who are not regulated from using the popular payment method Pix. This is controlled by the National Bank, and transactions can be completed in under 10 seconds.
Baungartner stated that “Pix was really important, and 99% of market is using it.” They think that they can stop those operators by using this payment method. This is a very fair approach.
Operators will be required to pay BRL30m ($5.5m), the licensing fee, by August. According to the timeline of the regulator, online gambling will be legal by January 1, 2025.
Baungartner admitted that some firms operating in Brazil may not be able afford to pay the license fee. He also noted that there would be grey markets in Brazil.
Some of them do not have $5.5m and are happy with their current situation. He said, “I think that the grey market is going to be around forever.”
Baungartner expects that up to 25 companies will apply for the licence before it closes.
They know that the online market has been up and running for a few years. “There is no alternative and everyone, including the government and population is looking forward to these regulations”, he said.
Baungartner said that he also expects M&A to be driven by the regulatory efforts in the country. MGM Resorts acquired Tipico’s US Sportsbook Platform earlier this month. Many believe that the deal will help drive MGM’s online initiatives in Brazil and LatAm.
Motion Regulation
Brazil’s President, Luiz inacio Lula, officially ratified a new regulation framework on sports betting and online gaming.
The bill was approved by the Brazilian chamber of Deputies on 21 December. The senate had removed igaming from the bill.
Brazil’s final regulation on online sports betting has a deadline of July, which is seen by some as being ambitious.
Baungartner told iGB previously in April that “the schedule is reasonable, and it’s doable.” The [ministry] of finance just has to make sure that other departments in the government are all on the same page, and do not block the process.
Baungartner, a Baungartner spokeswoman said: “We’ve waited for this since 2005. It has been almost 20 years.”
He said that if all goes smoothly, we could also get casinos in 2025.
On 20 June, the Justice and Citizenship Commission of Brazil (CCJ), in parallel with this, approved a law to legalise casino gambling, bingo games, jogos de bicho and horse racing betting.
This move cemented the intention of the government to regulate gambling online as well as offline.
