The year 2024 marks a milestone for the online betting market in Brazil. The regulation, long awaited by investors and operators, was implemented by means of the new Law No. 14,756/23 and the ordinances issued by the Secretariat of Prizes and Betting linked to the Ministry of Finance (“SPA“).

According to a study released by the Central Bank of Brazil, the volume of transfers via Pix[1] to Bets varies between BRL 18 billion and BRL 21 billion per month, not counting other ways of payment.

The market continues to expand. According to the national list released by SPA, updated on December 17, 2024, 103 companies are authorized by the Federal Government to operate more than 200 online betting platforms in Brazil,[2]in addition to the 31 bookmakers authorized to operate at state level.[3]

These numbers reflect the need for robust regulation that offers legal certainty and curbs illicit practices such as money laundering and match-fixing, as well as fraud in general.

In this context, Law No. 14,756/23 brought the first pillars of regulation, authorizing fixed-odds betting in Brazil by establishing minimum requirements for the exploration of the activity. The issuance and maintenance of the authorization to operate the activity will be subject to proof, by the operator, of the adoption and implementation of policies, procedures, and internal controls.

These mandatory policies include:

  • assistance to bettors and ombudsman;
  • anti-money laundering, terrorist financing and proliferation of weapons of mass destruction (“AML/TFP“);
  • responsible gambling and prevention of pathological gambling disorders; and
  • betting integrity and prevention of match-fixing and other fraud.

In addition to the law, the SPA issued in 2024 a series of relevant regulations, including Ordinance No. 1,143/24, which establishes operational and AML/PTF requirements – essential for compliance in Brazil.

Among the procedures established by Ordinance SPA/MF No. 1,143/24 in relation to the identification of bettors or users that allow verification and validation of identity at the time of registration, the following stand out:

  • Know Your Customer (KYC): implementation of processes for verifying and validating the identity of bettors, including identification of Politically Exposed Persons (PEPs);
  • Economic Capacity: assessment of the compatibility between the bettor’s economic and financial capacity and its associated operations;
  • Transaction Monitoring: active monitoring system to identify suspicious transactions and activities, with mandatory reporting to COAF;
  • Data Storage: record keeping for at least 5 (five) years, with periodic updating and validation.

Furthermore, the betting operator must establish internal AML/FTP policies assisted by a robust compliance program in order to submit an annual report to the SPA by February 1st of the following year, with information on good practices adopted in the previous year, as a way of monitoring by SPA.

Therefore, the regulation of the online betting market in Brazil represents a fundamental step for the economic development of the sector. However, AML/TFP and anti-fraud regulatory obligations pose significant challenges to operators, that must prioritize the implementation of policies, internal standards, and technological systems to ensure compliance.

The recent ordinances not only align Brazil with international standards but also demonstrate that the authorities are aware of the global trend. In this sense, it is up to companies to prepare themselves with all documents, policies, and internal structures for inspection, contributing to the credibility and sustainability of this promising market.

It is important to note that, as of January 1st, only companies that comply with Law No. Law No. 14,790/2023, as well as other SPA regulations, will be able to operate in Brazil.

For more information regarding the regulation of the sports betting market in Brazil, contact the Saud Advogados team.

[1] Pix is a payment system which lets users instantly transfer money in Brazilian reais created by the BCB.

[2] See “National List of Online Betting Companies Authorized to Operate Nationally” < https://www.gov.br/fazenda/pt-br/composicao/orgaos/secretaria-de-premios-e-apostas/lista-de-empresas/lista-nacional-versao-17-12.pdf > Accessed on 12/18/2024

[3] See “List of Online Betting Companies Authorized to Operate at Federation State Level”< https://www.gov.br/fazenda/pt-br/composicao/orgaos/secretaria-de-premios-e-apostas/lista-de-empresas/lista-estadual-versao-26-11.pdf