Brazil senate president still expects betting CPI creation despite delays, weeks before legal market launch

On 8 October, Senator Soraya Thronicke requested the creation of a CPI into betting in Brazil, with the aim of investigating the “growing influence of online virtual gambling games on the budget of Brazilian families”.

The request surpassed the 27 signatures needed, with the commission having 130 days after its establishment to carry out its work. It will have 11 full members and seven substitutes.

The CPI was expected to be installed on 25 October. However, its creation was delayed due uncertainty over which senators would work on the inquiry.

Pacheco maintains the momentum for the establishment of the CPI on betting hasn’t been lost. Its creation is vital, he said, with the legal betting market set to launch in Brazil on 1 January 2025.

“It [the CPI] needs to be installed now and made to work,” Pacheco told reporters. “I think it is a good measure to seek clarification and propose measures to limit and contain gambling and to improve discipline in relation to these bets.

“Unfortunately, casinos were not approved in Brazil physically, but they became part of family life. In other words, this law ended up placing casinos inside Brazilians’ homes. And obviously this needs to be limited, it needs to be better regulated to avoid gambling addiction and [to protect] entire families that are now compromised due to the expenses related to this issue of gambling.”

CPI also set to investigate criminal betting links

The betting CPI, for which Thronicke would be the rapporteur, will also look to investigate links between betting companies and criminal organisations.

In September, Darwin Henrique da Silva Filho, owner of Brazilian betting company Esportes da Sorte, was arrested as part of ‘Operation Integration’ over allegations of involvement in money laundering and illegal gambling.

The owners of VaideBet and Zeroumbet were also arrested as part of the investigation.

Esportes da Sorte was initially left off the Secretariat of Prizes and Bets’ (SPA) list of approved operators and therefore considered illegal for the ongoing transition period between 1 October and 31 December.

However, a court order subsequently saw Esportes da Sorte added to the list. Its owner Esportes Gaming Brazil had previously sought to circumvent Esportes da Sorte’s nationwide ban by achieving authorisation with the Rio de Janeiro State Lottery (Loterj) having acquired majority shares in the Loterj-licensed platform ST Soft.

CPI delayed amid growing pressure on Brazil’s gambling sector

As the online legal market closes in, last-ditch attempts have been made to halt its launch in less than two months.

In October, Senator Sérgio Petecão presented Bill 4,031/2024 to the senate, aiming to ban online betting in Brazil.

The presentation of Petecão’s bill occurred with criticism of the gambling sector on the rise over fears of its impact on the financial and mental health on Brazilians.

José Francisco Manssur, formerly a special secretary of the ministry of finance, warned a ban on online betting would be a backwards step for Brazil.

When will land-based gambling be legalised?

Alongside the delay to the establishment of the betting CPI in October, the vote to finally legalise land-based casinos was also pushed back again.

Bill 2,234/2022 to legalise casinos, bingo, jogo de bicho and betting on horseracing in Brazil was passed on a 14-12 vote by the Justice and Citizenship Commission (CCJ) in June.

However, it remains yet to be voted upon by the senate plenary and its October postponement was at least the second time it has been delayed.

The bill’s rapporteur, Senator Irajá Silvestre, spoke of his belief the vote will happen before the end of 2024 despite the setbacks.

And Pacheco concurred, although he explained the measure can only progress if the appropriate care is taken to reinforce regulations to counteract the concerns seen in the latter stages of getting online gambling over the line.

Pacheco expects there to be no impediment to the bill, although it still remains unclear when exactly the senate plenary will vote on the matter.