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1. Introduction

One of the most discussed topics in Brazil in recent years has been the introduction and rapid expansion of the sports betting market. Fixed-odds betting has overwhelmingly dominated this sector, becoming the leading sponsor of Brazilian football teams.

The popularization of this market has sparked intense debate regarding its social and economic impacts. On one hand, there is the promise of revenue generation and tax collection; on the other, legitimate concerns about gambling addiction, debt, social vulnerability, and the risks of money laundering. In response to this scenario, Statute #14,740/2023 came into force, regulating the “lottery modality known as fixed-odds betting” – a format where the bettor knows the potential payout at the time the bet is placed.

The new Act was enacted with three primary objectives: (i) to protect the most vulnerable social groups from the negative effects of gambling; (ii) to establish rules for monitoring activities and taxation; and (iii) to prevent financial crimes such as money laundering and terrorist financing.

However, what many may not realize is that although it is widely known as the “Betting Act,” this legislation regulates more than just sports betting. In addition to bets linked to “actual sports-themed events,” the act also applies to other virtual games offered electronically, such as virtual roulette and popular games like the “Fortune Tiger” (known in Brazil as “tigrinho game”), provided they fall under the legal definition of fixed-odds betting. To be legalized in Brazil, however, these games must meet a series of requirements.

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2. New Regulatory Framework

With the enactment of Statute #14,740/2023 – which will soon be two years old – the Brazilian government took a significant step toward formalizing and overseeing a sector that, while moving billions of reais, had been operating outside the law. Until then, betting existed in a state of general prohibition, inherited from Executive Order #9,215/1946, which banned games of chance throughout the country. Despite this ban, the practice never disappeared; it simply migrated to informal channels, offshore operations, or, more recently, the digital environment.

In this same context, Executive Order #11,907/2024 established the Secretariat of Prizes and Bets (Secretaria de Prêmios e Apostas – SPA), an agency linked to the Ministry of Finance (Ministério da Fazenda – MF). The SPA is now responsible for authorizing, licensing, regulating, standardizing, monitoring, supervising, inspecting, and sanctioning companies in the fixed-odds betting sector.

In this context, regulation was necessary to provide greater legal certainty for both consumers and companies interested in operating in Brazil. The Act officially recognizes the existence of fixed-odds betting, imposes requirements for operating companies, and defines the responsibilities of regulatory bodies.

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2.1. Who Can Operate in Brazil?

The Act provides that companies must meet the following requirements to operate in Brazil:

• Prior Authorization: the company must obtain specific authorization from the SPA, which may be granted for a period of five years.
• Headquarters, Legal Representative, and Administration in Brazil: the legal entity must be established under Brazilian law, with its headquarters and administration in the country.
• Domestic Participation: at least 20% of the share capital must be owned, directly or indirectly, by a Brazilian individual or legal entity.
• Legal Representative: the company must appoint a legal representative in the country responsible for liaising with the Ministry of Finance.
• Structure and Technical Capacity: the company must demonstrate an adequate operational structure, including:
  • Proven knowledge and prior experience in gambling, betting, or lotteries by at least one member of the control group;
  • Requirements for holding and exercising management or executive positions;
  • A bettor support structure, including a free electronic channel and an ombudsman.

• Information Technology: the company must possess a technological infrastructure that meets cybersecurity requirements, backed by a recognized certification, either domestic or international.
• Sports Integrity: the operator must integrate or associate with national or international bodies that monitor sports integrity.
• Money Laundering Prevention: the mandatory adoption and implementation of internal policies and controls to prevent money laundering, terrorist financing, the proliferation of weapons of mass destruction, match-fixing, and other fraud.
• Prohibition of Conflicts of Interest: the direct or indirect participation of partners or controlling shareholders of betting operators in Football Public Limited Companies (Sociedades Anônimas do Futebol – SAFs) or other professional sports entities is prohibited.
• Customer Service: the operator must provide customer service channels and an ombudsman.
• Payment of Concession Fee: authorization to operate fixed-odds betting is subject to the payment of a fixed concession fee, which can be as high as BRL 30,000,000.00, considering the use of three trademarks to be operated by the legal entity.

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2.2. Consumer Protection and Responsible Gambling

SPA/MF’s Ordinance #1231/2024 establishes rules and guidelines for responsible gambling to predict and mitigate individual and collective harms resulting from the activity. Key rules include:

• Minimum Age: participation in fixed-odds betting is prohibited for minors under 18, and operators must prevent minors from registering or using their systems.
• Voluntary Self-Exclusion: platforms must offer tools that allow bettors to request temporary or permanent exclusion from gambling environments at any time.
• Spending Limits: operators must provide mechanisms for bettors to set limits based on time elapsed, financial loss, total amount deposited, or the number of bets placed.
• Warning Messages: display warning messages about the risks of gambling addiction.
• Awareness Campaigns: the betting operator must promote awareness of the risks of addiction and pathological gambling disorders.

Furthermore, betting advertising will be regulated: it cannot target minors, suggest easy winnings, or associate betting with success or extraordinary abilities. Marketing actions are also prohibited from encouraging excessive gambling. This measure aims to curb the aggressive promotion of gambling, particularly among young people and economically vulnerable populations.

Through these measures, the law seeks to balance the promotion of economic activity with the need to protect the mental and financial health of the population, reinforcing the state's role as a social regulator.

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2.3. Anti-Money Laundering and Integrity Policies

Another crucial aspect of the legislation is the imposition of corporate governance practices aimed at preventing money laundering. These practices align with Statute #9,613/1998, which defines the crime of money laundering, and the Anti-Terrorism Act (Statute #13,620/2016), in addition to ensuring sound responsible gambling practices.

The Act states that the granting and continuation of an operator's authorization are contingent on demonstrating the implementation of internal policies, procedures, and controls. These must address:

• Preventing money laundering, terrorist financing, and the proliferation of weapons of mass destruction, in compliance with the duties outlined in Statute #9,613/1998 (Money Laundering Act) and Statute #13,260/2016 (Anti-Terrorism Act).
• Preventing match-fixing and other fraud that could compromise the integrity of competitions and public confidence.
• Continuous monitoring of bets, with analysis and selection of potentially suspicious transactions to identify atypical patterns indicative of money laundering or the financing of illicit activities.
• Immediate reporting to the Financial Activities Control Council (Conselho de Controle de Atividades Financeiras – COAF) of any transactions that raise reasonable suspicion of money laundering or terrorist financing.

These requirements reflect lawmakers' effort to integrate the betting market into the national system for preventing and combating financial crime, ensuring the new sector operates with transparency and traceability.

The legislation also imposes specific measures to ensure betting integrity, requiring operators to join national or international monitoring bodies. The goal is to foster cooperation between betting companies, sports entities, and public bodies, enabling the sharing of relevant information about suspicious bets or potentially manipulated events. Beyond protecting the financial system from money laundering and illicit financing, this measure aims to safeguard the legitimacy of sports competitions.

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2.4. The Expanded Scope of the Concept of “Gambling”

Although popularly known as the “Sports Betting Act,” Statute #14,740/2023 goes far beyond sports betting. The legal text defines a fixed-odds bet as any modality where the bettor knows the potential payout at the time the bet is placed – regardless of whether the event is sporting or not.

With this wording, lawmakers not only regulated the phenomenon of sports betting but also created a broader legal framework encompassing other forms of online gambling based on bets with predetermined outcomes.

With the publication of SPA/MF’s Ordinance #1207/2024, which establishes technical requirements for online games, it is clear that online gambling include other modalities, such as card games, virtual roulettes, crash games, and blackjack, provided they are offered by duly authorized operators under the supervision of the Secretariat of Prizes and Bets.

To this end, the Ordinance stipulates that:

• Games must display, at the time of betting, a multiplication factor for each unit of Brazilian currency bet, which defines the amount the bettor will receive if they win.
• Results must be determined by the outcome of a random future event, using a random number, symbol, figure, or object generator as defined by the game's rules.
• Paytables, covering all possible winning outcomes for the bettor, must be made available before bets are placed on the respective online game.

Thus, widely known games, such as the famous “Fortune Tiger,” can be classified as fixed-odds betting and potentially legalized, provided they meet all regulatory requirements. Until such a framework is fully implemented, however, they remain illegal.

The Ordinance expressly excludes fantasy games, skill-based games, and multi-bettor games from its scope, as it considers that they do not fall under the concept of fixed-odds betting.

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3. Conclusion

Statute #14,740/2023 establishes a comprehensive regulatory framework for the betting market in Brazil. By setting clear rules for authorization, supervision, consumer protection, and betting integrity, the legislation aims to ensure that fixed-odds betting operates within monitored legal parameters, balancing economic incentives with social responsibility. In this context, the Secretariat of Prizes and Betting was created via Executive Order #11,907/24, tasked with regulating and monitoring the fixed-odds betting market.

In addition to regulating sports betting, Statute #14,740/2023 encompasses other types of online games based on bets with predetermined outcomes, such as virtual roulette, card games, and blackjack. SPA/MF’s Ordinance #1207/2024 complements this by defining technical and security requirements for online gambling and clarifying the classification of games within the fixed-odds betting framework, while excluding fantasy and skill-based games. SPA/MF’s Ordinance #1231/2024, in turn, establishes responsible gaming guidelines, including addiction prevention measures, spending limits, voluntary self-exclusion, warning messages, and advertising rules, thereby reinforcing consumer protection and the social responsibility of operators.