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Brazil’s telecoms authority has begun blocking unlicensed gambling websites, even though industry experts believe squeezing payments will be the government’s best bet in enforcing new regulations.
At the direction of Brazil’s gambling regulator, telecommunications regulator Anatel has now sent a list of some 2,040 illegal betting sites to be blocked by more than 20,000 telecoms providers across the country.
Per a September 17 ordinance, all online gambling operators yet to apply for a federal license from Brazil’s Secretariat for Prizes and Bets (SPA) were considered illegal from October 1 and subject to blocking as of today (October 11), following a 10-day grace period for players to withdraw their money.
The SPA on Tuesday published an updated version of its whitelist of 96 operators that have submitted applications. A total of 18 companies operating under state licences in Rio de Janeiro, Minas Gerais, Paraná or Maranhão also are exempt from enforcement actions.
“Whoever is unregulated or not in the process of becoming regulated will be taken offline,” said Fernando Haddad, Brazil’s finance minister, in a statement announcing the start of the enforcement activity.
“Each [telecoms] company will take technical measures and we will be watching to guarantee that this blockade is done effectively and as quickly as possible,” added Anatel president Carlos Baigorri.
In addition to web blocking, Brazilian media groups and sports teams are also no longer permitted to advertise or be sponsored by betting operators that are not on the SPA whitelist.
“The whitelist will be used as the beacon for everything about the regulation in Brazil, both for the offering of bets as well as for advertising,” said Regis Dudena, SPA secretary.
“People are already seeing movement among platforms, social networks and television and radio channels to guarantee that advertisements are restricted to regulated companies.”
Still, Dudena cautioned that being on the whitelist was no guarantee of actually receiving a licence before Brazil’s regulatory regime is fully implemented on January 1.
The actions of whitelisted operators will be monitored by the SPA as applications continue to be reviewed during the ongoing transition period, Dudena said, “and all their behaviour will be taken into account up until the time of a final decision on their full licence”.
Although officials spoke only of web blocking and advertising on Thursday, experts believe the government actually has another ace in the hole when it comes to enforcement against illegal sites.
Cutting unauthorised operators off from the Pix instant payments system controlled by Brazil’s Central Bank is the “perfect method’ to block unlicensed gambling, according to Leonardo Baptista, CEO of São Paulo-based payments processor Pay4Fun.
Speaking at this week’s Global Gaming Expo (G2E) in Las Vegas, Baptista noted that Pix accounts for more than 95 percent of transactions in the Brazilian online betting market.
Any unauthorised operators would have to turn to illegal payments channels that are far less ubiquitous, Baptista said.
“Where the government will block sites is through the financial sector, the banking system, through Pix,” Baptista predicted.
