Brazil: Could the ministry of sport’s 45-day assessment period cause delays?
The latest order from Brazil’s SPA – Interministerial Ordinance No 28 – was published on 22 May in the country’s Official Gazette. The SPA was established in April as part of an ordinance outlining the first steps for implementing betting regulation.
Ordinance No 28 gives a set of responsibilities to the ministry of sport – including a 45-day period to comment on applications. Earlier this week, the ministry of finance published Ordinance No 27. This outlined that the SPA would receive 150 days to assess applications for licences. The SPA must also notify the applicants of their acceptance or rejection within this timeline.
Ordinance No 827 set a deadline of 31 December for operators to comply with the regulated market. From 1 January 2025, operators will be subject to penalties. The 45 days allotted to the ministry of sport could delay the licensing process further, according to Fabio Kujawski, partner at Mattos Filho.
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Kujawski also points out that delays could effect how operators advertise in Brazil. From 1 January onwards, it will be illegal for unlicensed operators to advertise.
“As of 1 January 2025, all operators that have not secured a licence will be deemed as operating illegally and may have [their] URLs blocked by determination from the ministry of finance,” he says.
“So, the problem is actually bigger than simply receiving the licence later, but to be no longer authorised to operate or to advertise – note that advertising from unlicensed operators will also be deemed unlawful as of 2025.”
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Andre Santa Ritta, associate lawyer at Pinheiro Neto Advogados says that on a general level, the timeline was “well-received”. But he admits that the industry will have to put in the work to make it happen – a pressure that will surely increase with this new 45-day allotment.
“Indeed, the timeline is daunting to say the least, but the ministry is confident they should be able to achieve it,” Santa Ritta says.
“My expectation is to see significant increase in the workforce at the authority in the upcoming weeks to meet the deadline. This happened before in other industries, such as finance.”
Further steps to Brazil’s betting and gaming licensing process
The latest ordinance also outlines that applications will be registered with SIGAP, Brazil’s betting management system. Applications will then be passed on electronically to the ministry of sport.
Applications will also be submitted to the attorney-general of the union. This is to prevent discrepancies between the SPA and the ministry of sport.
Both the SPA and the ministry of sport will be responsible for monitoring betting integrity in Brazil. The ministry of sport must communicate all suspected instances of match fixing to the SPA.
“The prizes and bets secretariat of the ministry of finance and the ministry of sports are responsible for ensuring, within the scope of their powers, the integrity of the unpredictability of events and sporting results, which are the subject of fixed-odd bets,” Ordinance No 28 reads.
The ministry of sport is separately charged with keeping and updating a list of sports entities that can be the subject of bets during sports events.
Ordinance No 28 will be enacted on 3 June.
Nearing the end of a long journey for Brazil regulation
If the ministry’s timeline is followed, Brazil’s igaming and sports betting market should be regulated by the end of July. The roll-out is set to take place in four stages and is already almost halfway through.
Stages one dealt with technical, payment and security requirements that operators must follow. Stage two – which concludes at the end of May – will see the SPA publish anti-money laundering and anti-terrorist financing policies.
Stages three and four will see the SPA publish rules on security requirements for online gaming and how the industry will contribute to socially responsible causes, respectively.
President Luiz Inacio Lula da Silva approved Bill 3,626/2023 in December. The bill officially permitted a regulatory framework for gaming in Brazil. It officially brought an end to a long road for the industry in one of LatAm’s most thriving sporting nations.