Brazil has revoked 85 sports betting licences, stripping nearly 190 brands of their authorisation to operate under interim measure MP 1.394. Licence fees are not being refunded.
Operators paid 30m reais (around $6m) per grant and lodged a 5m reais security deposit. Carlos Lima, president of the Brazilian Institute of Responsible Gaming (IBJR), puts grants and capital contributions at close to 2.6bn reais and 7.5bn reais respectively, with a multiplier effect of 28bn reais on the economy. The measure took effect overnight on 25 September: operators lost the ability to take deposits and bets at once, with only days to return customer funds.
Regulator against regulators
The government set stiff conditions for the market — accreditation of international laboratories, problem gambling programmes, KYC with biometric identification. Operators met the technical and financial terms and expected predictability. Lima says companies built operations on a 60-month payback. 'On 25 October, five-year contractual obligations will be cut off abruptly, with no maturation period and no return on investment,' he said.
IBJR and ANJL, alongside Abert and football clubs, have filed suits with the Supreme Federal Court (STF). A ruling on the measure's constitutionality has not been issued. The measure itself allows 30 days to withdraw licences, so on 26 October betting sites will be left without permits and without fee compensation.
Parliamentary deadlock and black market risk
The sector's fate now rests with the National Congress, which must consider the measure by 25 November. The joint committee on MP 1.394 has yet to be formed: members are appointed, but no chair or rapporteur has been chosen. Around 100 amendments have been tabled, most of them preserving operations but without online casino, leaving sports betting only. Congress can extend the voting window by 60 days, pushing consideration to March 2027. From 9 November the measure will block the parliamentary agenda.
Lima asks what happens to licences expiring on 25 October if Congress rejects the measure, and whether a new fee would be due. Legal uncertainty persists. He stresses that bettors will not stop betting. Migration to illegal sites will deepen the black market, which LCA Consultores estimates at 38% to 44% of the total market. Movement to underground platforms has accelerated since the ban, with more than 30,000 illegal sites operating in Brazil.
'These operations pay no taxes in Brazil, require no identity verification or facial recognition, offer no self-exclusion tools and sit outside Coaf and federal police oversight,' Lima said. Regulated companies are pressing for a stronger regulatory framework, arguing it is the only way to protect consumers and keep them out of the illegal segment.
