Bipartisan legislation would allow up to 18 online sportsbooks with nine awarded to sports franchises in the state
The regulation of gaming and betting in Brazil, under discussion in the National Congress and expected to happen in 2023, opens up the prospect of expansion for a market that is expected to move at least R$ 12 billion this year.
The value represents an increase of 70% over 2020 revenues in games and electronic games alone, according to surveys and analysis of sector data. Brazil already ranks 12th in the world in the games segment and remains the largest market in Latin America.
The potential for growth is even greater when one considers the lack of specific rules for game and betting modalities (such as sports or fixed odds) and illegal games (such as gambling, based on the element of luck – in the case of bingos, casinos, jogo do bicho, among others). According to industry estimates, illegal gambling generates at least R$27 billion a year.
With the regulation of games and different modalities, discussed in at least five bills, the forecast is that companies that operate in the betting market and are headquartered abroad (on websites hosted on a server abroad), in jurisdictions where betting is regulated and legal, can generate currency for the country.
With a multidisciplinary team of professionals, Demarest has prepared a manual with information on the various types of gambling and betting – permitted or prohibited by sparse laws that address different topics – and the different bills in progress, which seek to create rules and facilitate the exploration of some types of gambling and betting in Brazil.
The work gathers in a single document the main regulations and projects of the sector, in addition to facilitating the understanding of the modalities that may or may not be offered in Brazil, to avoid risks to national and foreign investors.
It also addresses aspects related to intellectual property and the LGPD (General Law for the Protection of Personal Data or Law No. 13,709/18), in force since 2020 and which brought rules for the processing of personal data, including those applied to digital media (such as games and electronic games).
“Knowing and understanding the discussions and what is to come will represent an advantage for investors in the sector, who will be able to identify business opportunities”, says Monique Guzzo, lawyer in the Regulatory and Public Law areas at Demarest.
“It is a market that has grown exponentially in recent years, despite the fact that there is still a lack of regulation and some types of games are even prohibited. Therefore, the legislator has to keep in mind that the new rules need to be viable and sustainable to attract new investments. Otherwise, the current structure of this sector will remain, with companies headquartered abroad exploring this market in Brazil. And the new legislation will run the risk of being a ‘dead letter'”, concludes the lawyer.
Gambling regulation has economic impacts that involve not only tax collection and job creation, says Tatiana Campello, partner in the areas of Intellectual Property, Technology & Innovation and Privacy, Technology & Cybersecurity at Demarest. “It also brings opportunities in brand licensing, technology, with the development and use of artificial intelligence, and aspects related to intellectual property.” The partner also points out that it is necessary to pay attention to the issue of privacy and protection of personal data of players or bettors.
For Fabyola En Rodrigues, partner in the Corporate Criminal and Compliance areas, “it is essential that the legislator regulates the types of games, bringing security to investors and consequent market growth. Otherwise, casinos would be banned worldwide.” And he highlights: “It is necessary to dissociate that games are always related to money laundering, as well as to combat the aspect of negative and harmful moral burden”.
By considering these aspects, companies that already operate and those that intend to enter this sector, online and offline, will be able to act more effectively and within the legal framework, according to the specialists.
The manual is an unprecedented work in the legal market, with the objective of analyzing the legal framework of the gaming and betting sector. It will be updated periodically, as the regulation of the issues raised in the bills and legislation of the sector advances.
The partners and lawyers from the areas involved in the topic are available for interviews and to explain more details of the manual, which can be downloaded for free at this link in Portuguese and in English.
About to complete 75 years of history, Demarest is one of the most respected law firms in Brazil and Latin America, a position that is reinforced by rankings from a variety of publications, including Chambers, Thomson Reuters, Latin Lawyer, The Legal 500 and IFLR. With offices in São Paulo, Rio de Janeiro, Brasília and New York, it offers legal services with the highest standard of quality and excellence.
Demarest is recognized as one of the best places to work with the certification granted by the Great Place to Work®, an institution that also certified it as one of the Best Companies in Brazil for Women to Work. This year it was also recognized by Instituto Mais Diversidade, in partnership with the Forum of Companies and LGBTI+ Rights and the Human Rights Campaign Foundation (HRC), as one of the best companies for LGBTI+ professionals to work for.