Brazil is preparing to close its regulated online betting market after President Luiz Inácio Lula da Silva signed a provisional measure prohibiting fixed-odds betting across the country.
The measure, published on 25 September, immediately stopped licensed operators from accepting new customer deposits and sets 6 October as the date when betting websites and applications must go offline. The prohibition covers sports betting and online games in both physical and digital environments, including operations authorised by Brazilian states and the Federal District. Other lottery products already permitted under Brazilian law are not affected.
Brazil introduced its fully regulated federal online betting regime from January 2025, making the decision a major reversal less than two years after licensed operations formally began.
Operators face phased October shutdown
Customers have until 23:59 on 5 October to voluntarily withdraw money held in their betting accounts. From 6 October, authorised platforms must cease operations.
Operators will then have 7 and 8 October to report remaining customer balances to financial institutions, separated by each bettor’s CPF tax identification number. Banks must return those funds between 9 and 14 October.
If banking partners are unable to complete refunds, state-owned Caixa Econômica Federal will take responsibility for returning outstanding balances from 14 October onward. Operators also have until 5 October to remove physical advertising, sponsorship materials and outdoor betting promotions.
The government said 85 federal betting authorisations had been granted before the prohibition. Each authorisation required a BRL30 million payment, meaning operators collectively paid BRL2.55 billion for access to the regulated market.
However, the provisional measure states that cancellation of the licences is being carried out in the public interest and does not create a right to compensation for lost profits, previous investments or the fees paid for licences.
Finance Minister Dario Durigan said authorities had previously introduced regulatory controls and measures intended to reduce gambling-related household debt, but the government concluded that those measures had not sufficiently addressed the problems associated with betting. Lula has repeatedly linked the sector to financial hardship and gambling-related harm, while also criticising Brazilian football’s growing reliance on betting sponsorship.
Government prepares criminal penalties
Alongside the provisional measure, the government has drafted legislation that would establish criminal offences connected to prohibited betting activity.
Operating fixed-odds betting could carry a prison sentence of four to six years. Advertising betting products, recruiting bettors, facilitating betting payments or providing internet applications used for prohibited betting could result in sentences of two to four years, with additional penalties possible in certain cases involving personal data, minors or attempts to bypass age and location controls.
Administrative penalties under the new framework can also include fines of up to BRL2 billion and partial or complete suspension of business activities.
The government has created an institutional committee coordinated by the presidential Chief of Staff’s office to bring together authorities responsible for detecting, blocking and prosecuting illegal betting activity. The Finance Ministry’s Secretariat of Prizes and Bets can identify unauthorised domains and refer them to telecommunications regulator Anatel for blocking, while authorities can also target applications and payment channels.
Enforcement has already started. On 27 September, the Justice and Finance ministries said a joint task force had identified and taken action against 506 websites suspected of illegally offering betting services following the introduction of the ban. Authorities also reported finding betting advertising on Meta and Google platforms after the prohibition entered into force.
Industry challenges expected
Industry organisations have strongly opposed the shutdown. The National Association of Games and Lotteries has said it intends to challenge the provisional measure in court, arguing that closing the licensed sector could reduce tax revenue, cost jobs and push customers toward unregulated operators.
The Brazilian Institute of Responsible Gaming has separately warned that dismantling the recently established regulated market could create substantial economic and legal consequences and reverse efforts to bring existing gambling activity under formal supervision.
The measure therefore opens a new phase of legal and regulatory uncertainty for operators that entered Brazil under the federal licensing framework, while the government moves rapidly toward eliminating licensed fixed-odds betting from 6 October.