Martin Lycka – SVP for American Regulatory Affairs and Responsible Gambling at Entain – shines a light on the quest for sports betting regulation in Brazil.
Once upon a time, there was an illustrious realm in Latin America called Brazil. It played host to a plethora of the world’s most renowned sporting tournaments. Its mothers gave birth to legendary footballing giants, beach volleyball magicians, and fast-driving superheroes. Its shores were awash with fish and petrol; its fields with coffee, rice, and soybeans. And yet the realm was wanting in a few things, amongst them, crucially, sports betting and casino regulation.
In late AD 2018, the nobles of the realm gathered in a congress and granted the realm’s government the power to provide for regulation of sports betting within four years of the grant. The clock started ticking, first piano, but then with an ever-increasing urgency as the deadline loomed. What appeared to have been a very long time now felt like a minute or two away.
The government has been by no means remiss in its duty to fulfill the quest of finding the Holy Grail of Brazilian wagering. It dispatched its knights across the land as well as to realms far afield to bring back all the knowledge and intelligence that could aid with the arduous task. The knights have ridden tirelessly, consulted with nobles, the common folk as well as strangers, with a view to answering complex questions about permits, tax, server location, or advertising. Draft regulations have been written, re-written, scrapped, and written again. Presented, withdrawn, rejigged, and presented again. The Grail has however remained elusive.
With less than two years to go, the nobles held an assembly again and decreed that the tax applicable to sports betting shall be one of a dual nature, namely five per cent on gross gaming revenue combined with 0.05 per cent on turnover. One part of the quest has been complete; the Grail has started taking some shape.
The journey ahead is still rather long though and made even more complicated by two additional occurrences: first, the government needs to divide its attention between the sports betting quest and its efforts to regulate instant lotteries, with the latter one having spiraled out of control. Secondly, the supreme court of the land bestowed upon the individual parts of the land a God-given right to regulate lotteries, including sports betting, within their respective territories.
What follows is more drafts, more presentations, more rejigging, more reshaping on the central level. There’s certainly will, so there ought to be a way. Yet again, the nobles choose to step in to steer the government’s knights towards the right path. They select the most enlightened, valorous, and preeminent amongst themselves and form a Round Table, under the leadership of the newly crowned King Arthur of Lira, to debate the gambling matters at hand. The debate extends not only to sports betting but also to other forms of engaging with gambling fortune, namely bingo and casino.
After a few months of conference, the Round Table comes to a Solomon-like conclusion – the government shall decree on sports betting and esports while there shall be a separate bill to address issues related to land-based as well as online casino games and bingo. An initial iteration of the casino bill is produced, with online and land-based being untethered and proposed to be subject to a 17 per cent GGR tax and put to vote in the full chamber.
Following a charm offensive amongst those nobles who would not have been naturally predisposed to support a gambling measure, owing mainly to religious reasons, the bill passes in a first reading and will be back for additional scrutiny when the chamber comes waltzing in from its holiday recess. In the meantime, the government’s knights retain their liberty to continue searching for the sports betting Holy Grail and, at odds with its fame for never having been found, are expected to locate it throughout 2022. This truly Percivalic should result in the opening of a regulated market that is bound to attract a number of astute domestic corporations as well as an array of plucky strangers.
It however goes without saying that the wily old magician Jair Merlin Bolsanoro has been keeping a very close eye on all these endeavors. While he doesn’t appear to be alarmed by the sports betting quest, he may yet prove himself not so friendly towards land-based casino resorts …
Martin Lycka is the SVP for American Regulatory Affairs and Responsible Gambling at Entain. The statements made in relation to this article, do not necessarily reflect the opinions held by Entain Plc. Subscribe to Martin Lycka’s Safe Bet Show on all leading podcast providers. Click here for more information.