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Brazil President Jair Bolsonaro is reluctant to enact a regulatory decree and introduce accompanying legal changes for online sports betting before facing re-election in October, according to reports in the country.
When a draft regulatory decree authored by officials in Brazil’s Ministry of Economy became public in early May, it was expected that Bolsonaro would sign it in short order so that a regulated sports-betting market could be up and running in time for the start of the FIFA World Cup in November.
Six weeks later, that has yet to happen. But the President is widely reported to have discussed the issue with conservative and evangelical groups in Congress that represent a key support base before Bolsonaro’s tough re-election fight against former President Luiz Inácio Lula da Silva.
Because both online and retail sports betting have been authorized through a 2018 law, Bolsonaro would not need congressional approval for a regulatory decree to implement the market.
But the government is also reportedly preparing a “medida provisória”, or urgency measure, to make further amendments to the sports-betting law to address issues including enforcement and possibly taxes on winnings.
Globo reported on June 9 that Bolsonaro does not plan to introduce that legislation or enact the regulatory decree until after the election, to avoid clashing with evangelical members who are concerned that an urgency measure could be amended in Congress to authorise casinos, bingo halls or other forms of gambling beyond sports betting.
The December 2018 sports-betting law gave the government a window of up to four years to adopt regulations for fixed-odds sports betting. So it could still fulfil that mandate even if a decree is adopted after the October 1 election, with a run-off election more than likely to follow on October 31.
Still, a delay until after October would seem to make it impossible for the Brazilian market to be open in time for a World Cup that offers a unique customer-acquisition opportunity for licensed operators.
The draft decree published in May would establish a six-month transition period for offshore operators already active in Brazil, with detailed rules expected within 120 days. But there is a possibility of a regulatory sandbox to fast-track licensing for some operators, and possible limits on the number of licensees, within the first year.
Bolsonaro and presidential Chief of Staff Ciro Nogueira reportedly met with evangelical leaders in late May when they sought to reassure them that the sports-betting regime would not be expanded beyond that.
Sóstenes Cavalcante, the head of the evangelical bloc in Brazil’s Chamber of Deputies, told publication R7 earlier this month that online sports betting is a different matter to ongoing debate on land-based casinos and other forms of gambling, to which evangelicals remain fiercely opposed.
“As we have no way of controlling sites based outside the country, since we can’t legislate for the jurisdiction of other countries, then the best thing is what we have decided to do: tax them,” Cavalcante said.
In reality, sports betting is not the only area of gambling policy being affected by election-year politics.
Despite evangelical opposition, the lower house of Congress, the Chamber of Deputies, passed a sweeping bill in February to regulate more than 50 casinos, hundreds of bingo halls with tens of thousands of video-bingo machines, plus all forms of online gaming.
But after being sent to the Senate, the bill has yet to be assigned to a senator to serve as its rapporteur or to any committees to review the proposal.
Senate President Rodrigo Pacheco has similarly indicated that the gambling bill will only be taken up after the elections, and he has also pledged to undertake a careful evaluation of gambling expansion rather than support a more expedited process.
Bolsonaro, for his part, has consistently said he would veto the wider gambling bill.
But his administration did not instruct its party members to vote against the bill when it was before the Chamber of Deputies, while Chief of Staff Nogueira is a known proponent of gambling expansion as a former senator.
