Can Brazil push back against looming gambling ad restrictions?

A new wave of gambling ad restrictions is on the horizon for Brazil, following the Senate’s approval of Bill 2,985/2023 in May. This will likely add to the host of challenges faced by operators since Brazil’s regulated online betting market launched on 1 January. 

Although the bill’s rapporteur, Senator Carlos Portinho, eliminated a blanket ban on gambling ads from the proposal, the approved bill does include a ban on betting ads during live sporting broadcasts. The use of celebrities, influencers and athletes in any marketing material will also be prohibited, with the ban only applying to current players or those whose career ended less than five years ago. 

With both the Sports Commission and Senate having now approved the amended bill, it is headed to the Chamber of Deputies for review. 

The new law will likely not take effect until 2026, says Udo Seckelmann, head of gambling & crypto at local law firm Bichara e Motta Advogados. Seckelmann says he is relieved the “disproportionate” blanket ban has been eliminated, although he warns the push for further restrictions “lacks evidence-based support”.

“The motivations, although well-meaning, must be weighed against real-world outcomes – and the evidence suggests that informed, responsible regulation is more effective than prohibition,” Seckelmann explains. 

Current Brazil gambling ad regulations are sufficient

The Secretariat of Prizes and Bets (SPA) published Normative Ordinance No 1,231 in July last year, laying out how licensed operators could advertise their products. The regulations included restrictions on operators presenting betting as “socially attractive” or using ads to target children or adolescents. 

Additionally, all advertising from licensed operators was mandated to display an “18+” symbol and be guided by social responsibility and the promotion of responsible gambling. 

Lawyer Luiz Felipe Maia, founding partner of Maia Yoshiyasu Advogados, believes current restrictions on advertising are adequate, especially with Brazil having only just regulated its iGaming sector. 

“I think the current regulation is sufficient in protecting people, and they are coherent with this stage of the market, because Brazil has just become regulated,” Felipe Maia tells iGB.“When you have a new regulated market, it’s important to allow the regulated operators to advertise and to become known to the public, so that you can drive the public to those regulated operators. I think it’s [important] that we don’t have that many restrictions, such as in other regulated but more mature markets.” 

Fellipe Fraga, chief business officer at licensed operator EstrelaBet, agrees the current regulations are sufficient. “I believe it’s enough,” Fraga says. “Most important is to have conscience. The politicians and other regulators understand that the market is okay [as it is] and all the world is doing [online betting], so we can also advertise.” 

On the other hand, Betsul CEO Fernando Garita is keen for the advertising regulations to be more clearly defined. Garita is calling for clarity and consistency from the SPA: “A better balance is needed – one that enables responsible messaging without stifling legitimate commercial activity.” 

Enforcement is the priority 

While the licensed sector is generally content with current ad restrictions, many stakeholders are urging stricter enforcement be applied, especially when it comes to influencer advertising, which last year became a sector, and national media topic du jour.  

The game “Fortune Tiger” faced huge controversy last year. Influencers were investigated and in some cases arrested, after marketing the game to their followers and promoting attractive financial rewards. Many players ended up losing large sums of money playing the game on fraudulent sites. 

Since the scandal, the SPA has taken steps to further restrict influencer advertising. Internet personality Virgínia Fonseca appeared in front of the parliamentary inquiry commission for betting in May to be questioned over advertising gambling to her huge online following. 

Felipe Maia believes the SPA should crack down on those infringing upon current regulations. “I think if we start to have these cases where digital influencers will be held liable, have to pay fines and maybe be arrested for working with illegal operators or not complying with advertising rules, we will start to see different behaviours,” he insists. 

Overregulation risks empowering the black market 

The Brazilian gambling sector is by no means the only market experiencing pressure over its gambling advertising. Looking elsewhere at more mature markets, it’s understandable there are fears over the consequences of further restrictions. 

Germany, where nearly half of all players bet with the black market, has a ban on TV and online advertising between 9pm and 6am, as well as restrictions on showing sports clips in ads and partnering with sports personalities. 

Italy, which has a blanket ban on gambling advertising, is experiencing serious black-market issues, while Brazil’s neighbour Argentina has also taken steps to introduce a ban on online betting advertising. 

With licensed operators in Brazil already concerned by the presence of the black market, the industry fears more stringent regulations on advertising would only strengthen illegal companies, as seen in other nations. 

“Experience from countries like Italy shows that excessive restrictions and high taxes can backfire,” Garita explains. “Blanket bans would significantly reduce the visibility of regulated operators, while illegal ones would continue to thrive through uncontrolled channels like Telegram. 

“If you have a market becoming regulated with too many restrictions for advertising, basically you’re hurting channelisation and you are aiding the black market,” Felipe Maia adds. 

Gambling ads helps identify legal operators 

In fact, advertising is actually a hugely important tool for operators to demonstrate they have a licence and channel bettors into legal offerings, particularly in the early stages of a licensed market’s development, when competition among brands is fierce and player loyalty has not yet been established.  

With licensed operators’ advertising required to have an “18+” symbol, as well as information on the associated risks of addiction and pathological gambling disorders, Garita says the role of advertising in distinguishing legal from unlicensed operators is “a crucial one”. 

Garita says: “Advertising is one of the few public-facing tools we have to demonstrate that we operate legally.  

“It allows us to build trust, promote safety, educate users and show that we work within a regulated framework. Eliminating that visibility blurs the lines between legal and illegal operations – posing a major risk to consumers.” 

And even with advertising providing that distinction, markets like Sweden have found a high percentage of players still cannot distinguish legal operators from black market brands.  

What’s behind the negative public perception of gambling?  

Significant pressure was put on Brazil’s gambling sector in 2024, during a crucial period of establishing regulation. A Supreme Federal Court hearing in November was initiated after a leading trade union accused the new betting laws of being unconstitutional, amid fears that betting leads to high addiction levels and family debt. 

But four months into licensed betting, the public opinion towards betting seems to be improving, and in April a government-funded survey by DataSenado reported 60% of the population is now in favour of legalising land-based gambling. Part of the industry’s frustration lies in the belief that politicians are responding to public pressures, rather than data and global sector experiences that prove why ad restrictions could have unwanted consequences. 

But some politicians, particularly the rapporteur of the new advertising restrictions bill, have adopted a negative rhetoric around gambling, insisting it is harming public health and finances.  

Political echo chamber

Felipe Maia believes there isn’t actually a negative public perception of gambling in Brazil and asserts politicians are simply repeating the concerns of specific groups. “Basically, they’re responding to their echo chambers,” he says.  

“If they’re religious, they are responding to the groups they represent. If they’re more conservative, they are saying [these things] because this echoes well to their public. What you have is an opportunistic approach by some politicians to use this for propaganda purposes.” 

The situation is complicated further by Brazil’s long history of gambling prohibition, with the sector essentially made illegal in 1946. This has resulted in a lack of political understanding.  

“We’re trying to make them understand and, of course, in Brazil, with 80 years with cultural prohibition of gambling, they don’t really know yet what our industry does, what you can provide for the country,” says Fraga. “It’s a process for us to teach them, to explain to them [how our industry works] and to avoid those views, because many of these [bills] are talking about misconceptions.” 

What’s the solution? 

Ultimately, an effective response to Bill 2,985/2023 from Brazil’s betting sector could be handicapped by fragmented representation of the industry. 

According to Felipe Maia, there are five trade associations that represent betting companies, causing a lack of coordination and likely a weakening of the industry’s response to any perceived overregulation. 

“I had this complaint from a congressman. What they say is it’s very hard to deal with this industry, because they get different inputs from different associations and then they don’t know who to trust,” Felipe Maia declares. 

Collaboration is the way forward in Garita’s view. He agrees there is fragmentation in industry representation and that complicates the formation of an effective response. 

“Lobbying efforts and collective action by responsible operators and associations will be crucial,” Garita adds. “We need unity and coordination to defend common interests.” 

During the Sports Commission hearing to approve Bill 2,985/2023 in 28 May, Senator Portinho said the changes were necessary due to the sector’s inability to police its own advertising activities.   

Felipe Maia urges operators to self-regulate where possible, to prove they are good actors. “I think self-regulation shows social responsibility, maturity. And it allows you to come up with solutions that work for the industry before someone comes with an idea that will not work,” he says. 

Critical juncture coming up 

As Seckelmann explains, an assertive but constructive approach to advertising regulations could help mitigate the negative opinion held by politicians. “It is essential to emphasise that advertising, when done responsibly, plays a key role in channeling users toward licensed, safe operators and away from illegal sites,” he reiterates. 

As it stands, those seeking to restrict gambling look to be edging the battle, especially with the industry’s current inability to form a collective, data-driven response that effectively warns against the perils of overregulation on advertising witnessed in other markets. 

The industry’s point is clear: Overly restrictive measures on ads at this point in Brazil’s regulated online journey could prove disastrous and drive players out of the licensed sector. 

As the Chamber of Deputies, the Senate’s final stage, prepares to evaluate Bill 2,985/2023, Brazil’s betting sector must act quickly to make its case against the perceptions that threaten to damage the legal market’s progress.