The Gambling Law Review: Brazil


Brazil is the largest and most populated country in Latin America, with a total area of 3,265,080 square miles and a population of more than 207 million people2 (it is the fifth-largest country in the world with regards to size and population). Brazil is a federation divided into 26 states, one Federal District and 5,570 municipalities.

Since 2012, owing to the depreciation of the real against the US dollar and the economic recession that began in 2015, Brazil's GDP has decreased and the country is now the world's ninth-largest economy,3 having formerly been the sixth-largest in 2011.

Almost all gambling activities have been prohibited in Brazil for over 70 years. Since the general ban on games of chance in 1941, the only legal gambling activities are the lotteries under the state monopoly, and horse-race wagering. According to Brazilian law, poker is a game of skill and is therefore not illegal.

With the economic turmoil, it has been said that gambling regulation (and taxation) may help the government to raise revenues. Two bills of law are currently under discussion in the Congress concerning casinos, bingos, online gaming and lotteries. Integrated resort casinos were included in the Tourism Law Bill and there may be an Integrated Resort bill introduced later this year.

The year 2018 was a very positive year for gambling regulation in Brazil. In December, Law 13,756 created the fixed-odds sports betting lottery method, granting powers for the Ministry of Economics to regulate it and issue licences.

The tender for the privatisation of LOTEX, the instant lottery, which was scheduled for 2018, was postponed and took place in May 2019, with no proposal. As result, the Brazilian government will need to reconfigure the business model and will probably low the financial and technical requirements to allow more participants in a future attempt to privatise LOTEX. Sports Betting regulation is also in the pipeline of the Ministry of Economics and is expected to start in 2019, so that the first licences can be issued in 2020.

i Definitions

Gambling, in general, is not regulated in Brazil. In fact, since the 1940s, Brazil has been a closed market for gambling, with only state-owned lotteries and horse-race wagering. For a brief period in the 1990s, bingos and slot machines were permitted, but they were banned in the mid-2000s.

As a consequence, Brazil's gambling regulation is still incipient. 'Game' is a contract type expressly nominated, but not defined, by the Brazilian Civil Code. Its definition is provided by jurisprudence.

Luiz da Cunha Gonçalves4 defines a game contract as 'a commitment, agreed as for hobby or as for desire for money, between two or more individuals, in which each player agrees to pay a certain sum of cash or something else to the other party(ies) if he/she loses, based on some future event, which implementation depends, at least in part, on the activity of the players'.

Clóvis Beviláqua,5 the author of the previous Brazilian Civil Code, defines a game contract as a random contract, in which two or more people promise a certain sum, among the contractors, to the person for whom the result of chance is most favourable. In the same vein, Pablo Stolze Gagliano and Rodolfo Pamplona Filho6 provide a very detailed explanation on game contracts:

In fact, the contract game can be defined as a legal transaction whereby two or more people hold a particular promise (usually with pecuniary content) in favour of the person who achieves a favourable result in the performance of an act in which everyone participates.
Note that the game (and thus the success or failure of each party) necessarily depends on the performance of each party (called a player), either by his intelligence, or by his skill, strength, or simply luck.
The bet contract, in its turn, is a legal transaction in which two or more people with different opinions on a certain event, promise to perform a particular action (in general, with monetary content) to the benefit of the party whose opinion prevails. Hence, in the bet, there is not the requirement for the active participation of each party (called a bettor) to influence the outcome of the event, but rather only the expression of her/his personal opinion.

The difference between a game and a bet is that the result of a game will depend on the action of the parties, while the result of a bet depends on facts unrelated to the parties' will. It is important to highlight that these definitions have been created by jurisprudence and are not expressly set forth by law, although they are widely accepted and applied by the courts.

'Games of chance' are defined by Article 50 of Decree-Law 3,688/1941 (the Misdemeanour Law or Criminal Contravention Act) as:

  1. a game in which winning or losing depends exclusively or principally on chance;
  2. bets on horse races outside the racetrack or other authorised venues; and
  3. bets on any other sport competition.

'Public place' is defined as:

  1. a private house in which games of chance are held, when those who usually take part are not members of the family that live at the house;
  2. a hotel or collective residence where the guests or residents are offered games of chance;
  3. the headquarters or premises of a company or association where games of chance are held; and
  4. an establishment intended for the operation of games of chance, even if its purpose is disguised.

Games of chance are treated as misdemeanours, which are recognised by law as offences punishable by minor penalties (Article 61 of Law No. 9,099/95). In other words, a misdemeanour is a less offensive crime when compared to a criminal violation of Brazilian law. The purpose of using the term 'misdemeanour' is to implement the 'moral police', which, according to Professor Humberto José da Nova, includes 'safeguarding morality' in order to 'prevent certain illegal and vicious acts, or defend certain moral sentiments regarded as indispensable to harmonious social coexistence, the effects of which are harmful to the interests of the collectivity'.7

Contrary to this, 'games of skill' are those whose results depend on ability of the player, more than on luck. These are lawful.

'Lotteries' are defined by Article 51 of the Misdemeanour Law as the operation of payment of prizes depending on the result of the draw of tickets, lists, coupons, vouchers, signs, symbols or similar means.

Article 51 of the Law prohibits the operation or promotion of unauthorised lottery games in Brazil, including the distribution of foreign lottery tickets in the country. The Brazilian numbers game Jogo do Bicho (the animal game), which is similar to a lottery, is also prohibited.

Horse-race betting is regulated by Law No. 7,291 enacted on 19 December 1984 and its 1988 regulation, Decree No. 96,993.

Finally, contest regulation is subject to federal jurisdiction in Brazil. Therefore, there is equal legal treatment in all of the 26 states and the Federal District. In Brazil, whenever a contest is held to promote the sale of products or to promote brands, it is deemed as a prize promotion, subject to Law No. 5,768 of 20 December 1971, Decree No. 70,951 of 9 August 1972 and Law 13,756 of 12 December 2018.

ii Gambling policy

As a rule, gambling has been prohibited in Brazil since 1946, when the last casino permits were cancelled. A number of scholars believe the gambling prohibition in Brazil was a reaction to the industrialisation of the country, because of the need to make free men dedicate their time to work and not to leisure. This, together with the religious belief that 'in the sweat of thy face shalt thou eat bread', caused gambling to be seen as something negative. However, this belief is no longer socially widespread in Brazil.

There is, however, a general perception that gambling activities in Brazil are a cover for money laundering and that gambling activities are operated by criminal organisations. This derives from the fact that, despite the general prohibition currently in place, bingo halls, slot machines and Jogo do Bicho can be easily accessed in Brazil.

The end of Caixa's monopoly on lotteries, with the privatisation of the instant lottery operation (LOTEX), and the legalisation of sports betting, may lead to the necessary change in public perception that will allow other gaming methods to be regulated.

iii State control and private enterprise

Poker and other games of skill, as well as social games, can be operated by private entities. These activities do not require any specific licence.

Horse-race wagering is restricted to non-profit entities that own the racetracks, duly authorised by the Ministry of Agriculture, Livestock and Food Supply. These entities may appoint agents to facilitate wagering on their behalf, and can also hire private suppliers, which are not subject to licensing or any specific regulation.

Lotteries can only be state-owned. Caixa was granted the control of the federal lottery as result of Decree No. 50,954 of 14 July 1961, which cancelled all lottery licences granted to the private sector.

In addition to Caixa, only the states that had their own lotteries running when Decree-Law No. 204 of 27 February 1967 was enacted are authorised to run their own lotteries. These lotteries are:

  1. Loteria de Paraíba – Lotep;
  2. Loteria de Rondonia – Lotoro;
  3. Loteria de Ceará – Lotece;
  4. Loteria do Pará – Loterpa;
  5. Loteria de Rio de Janeiro – Loterj;
  6. Loteria do Rio Grande do Sul – Lotergs;
  7. Loteria de São Paulo;
  8. Loteria Social de Alagoas;
  9. Servico de Loteria do Estado do Paraná – Serlopar;
  10. Loteria de Minas Gerais – Loteria Mineira;
  11. Loteria do Estado do Distrito Federal;
  12. Loteria do Estado do Mato Grosso do Sul;
  13. Loteria do Estado do Pernambuco;
  14. Loteria do Estado do Piaui;
  15. Loteria do Estado de Goiás; and
  16. Loteria do Estado do Mato Grosso – Lemat.

Federal and state lottery operators (i.e., Caixa and the state's equivalent entities) may contract suppliers by means of public procurement. There is not any specific licence requirement for these suppliers. The federal government is in the process of organising the public bid for privatisation of instantaneous lotteries (sweepstakes).

iv Territorial issues

Starting in 1993, when bingo and slot machines were legalised, the state lotteries started to develop new gaming products, issuing authorisations for bingo venues, slot machine parlours and even online gaming based on state laws that allowed such activities in the territory of each state. Only in 2007 did the Brazilian Supreme Court definitely rule that states and municipalities could not legislate on gambling. For this purpose, a Binding Decision (Binding Decision No. 2) that has to be followed by lower courts established that: 'Any state or district law or legislative act that regulates raffles and consortiums, including bingo and lotteries, is unconstitutional.'

In 2009, however, when faced by a claim that the State Lottery of Rio de Janeiro's expansion towards keno-style gaming was unconstitutional,8 one judge from the same Supreme Court declared that state lottery regulations enacted before Binding Decision No. 2 of 6 June 2007 are valid.

v Offshore gambling

A legal loophole currently allows offshore operators to offer their gambling products to Brazilian citizens. One of the general rules about contracts in the Brazilian Law is that a contract by and between absent parties is deemed executed in the place of the proponent. This is set forth by Article 9, paragraph 2 of the Law of Introduction to the Brazilian Rules of Law (Decree-Law No. 4,657 of 4 September 1942) and repeated in Article 435 of the Brazilian Civil Code.

As a consequence, if an offshore operator's website is hosted in another jurisdiction where gambling is authorised, the contract between the Brazilian client and that operator is valid and subject to the law of operator's jurisdiction. This has some legal consequences in Brazil regarding consumer protection laws and unauthorised transborder financial transactions, the latter with potential criminal aspects. So far, however, there have not been any attempts by the Brazilian government to bring any action against foreign operators.

Legal and regulatory framework

i Legislation and jurisprudence

According to the Criminal Contravention Act, games of chance are prohibited in Brazil. Any form of gambling activity that has not been expressly legally authorised may be considered illegal under the scope of the Act and, therefore, anyone carrying out such an activity may be prosecuted. Decree Law No. 50,954 of 14 July 1961 establishes Caixa's monopoly on lotteries, and Law No. 7,291 of 19 December 1984 and Decree Law No. 96,993 of 17 October 1988 regulate horse-race betting.

ii The regulator

The Secretariat of Fiscal Monitoring, Energy and Lottery of the Ministry of the Economy is in charge of regulating lottery activities in Brazil. State lotteries must comply with the gaming standards set forth by the Secretariat and may not create new gaming products.

The Ministry of Agriculture, Livestock and Food Supply is the entity responsible for the regulation of horse racing.

Poker, recognised as a sport by the Ministry of Sports, is not regulated. Neither are social games nor any other kind of games of skill.

The free distribution of prizes is regulated by the Ministry of the Economy and is subject to previous authorisation by Caixa or by the Secretariat, depending on the operator.

iii Remote and land-based gambling

There is not any distinction between online gambling and bricks-and-mortar gambling for horse racing, provided that the general wagering plan expressly states the possibility of both. For the lotteries, Caixa does not allow their points of sale to accept remote bets.

iv Land-based gambling

Land-based gambling in Brazil is restricted. Caixa has licensed over 13,000 lottery points of sale that are privately operated with permission (small venues that also operate as bank assistants, accepting payments of general services bills). Jockey clubs have their own agencies and agents (around 200), that are authorised to accept wagers on local and international races. Poker has become very popular in Brazil and there are many poker clubs open in the largest cities.

v Remote gambling

Brazil's federal legislation does not contain any specific provision related to online gambling. Horse-racing entities already offer bets online in Brazil and Caixa only offers online betting for their account holders. The majority of the remote gambling activities in Brazil involve offshore operators, mainly sports betting and bingo.

vi Sports betting

The Fixed-Odds Betting lottery method was created by Law 13,756/2018, in the form of an exclusive public service of the Union, which commercial exploitation will take place throughout the national territory. This lottery method's legal definition is a system of bets related to real sports events, in which the prize the bettor can win in the event of a successful outcome is defined at the time the bet is posted.

Types of bets allowedOnly fixed-odds on sports events
RegulatorMinistry of Economics
RegulationTo be issued by the Ministry of Economics in the next two years (term renewable for additional two years)
LicensingAuthorisation (without tender) or concession (with previous public tender), yet to be defined by the regulation
Number of licencesTo be regulated by the Ministry of Economics
Minimum payout80% of the turnover89% of the turnover
Maximum GGR14% of the turnover8% of the turnover
Mandatory payments (calculated on turnover)0.5% for social security;
1% for the entities indicated by the Ministry of Education;
2.5% for Public Safety National Fund;
and 2% for the soccer teams that assign the rights to use their names, brands, emblems, hymns, symbols
0.25% for social security;
0.75% for the entities indicated by the Ministry of Education;
1% for Public Safety National Fund;
and 1% for the soccer teams that assign the rights to use their names, brands, emblems, hymns, symbols
Taxation on players' winnings30% withholding tax on each prize over 1,903.98 reais*
Taxation on the operatorVaries between 0.174 and 0.294% of the previous month's payout, according to Annex I of the Law
Other applicable taxesOrdinary corporate taxes:
Income Tax: 15-25% on actual profits;
Social Contribution on Profits: 9% on actual profits;
PIS and COFINS: 9.25% on GGR (some expenses are deductible); and
Municipal Services Tax: 2-5% on GGR
AdvertisingShall be guided by the best practices of corporate social responsibility, according the regulation yet to be defined
AMLThe operator will have to send information to the Financial Activity Control Council (COAF), pursuant to the rules yet to be defined

*This amount may change yearly and corresponds to the income tax exemption limit for individuals

The Ministry of Economics has up to two years, renewable for the same term, counted from the publication of this Law, to regulate the fixed-odds betting lottery method. A critical part of the regulation will be the definition of the competition model: whether the number of licences will be limited or unlimited, and as a consequence, if a public tender for licence will take place (in case the number of licences is limited) or if the applicants will only have to pay a licence fee and comply with the regulatory requirements.

The licensing process

i Application and renewal

The application for a horse-racing gambling licence should be made before the Ministry of Agriculture. The applicant must be a non-profit entity legally incorporated in Brazil, in possession of a racetrack, and also needs to demonstrate the technical and economic viability of the weekly racing schedule and the floor plan of the race field. That entity must present the draft of a general betting plan (which includes the rules applicable for each game to be run by the operator, such as prize, ticket value, minimum and maximum betting amounts, and payout).

Horse-racing entities must also apply for their agents' licences before the Ministry of Agriculture, Livestock and Food Supply. This application must be made by the authorised horse-race entity, which must be entirely responsible for any and all acts of the agent. The agent licence is granted to the agent (person or company) to facilitate wagering only at the specified venue. Horse-racing personnel and suppliers do not need to apply for licences and are not regulated.

Both authorisations, for the horse-racing entities and their agents, are valid without any time limitation. Revocation may occur when there is a non-observance of rules and procedures after the due administrative process.

ii Sanctions for non-compliance

Article 22 of Law No. 7,291 of 19 December 984 and Articles 91 to 97 of Decree-Law No. 96,993 of 17 October 1988 define the penalties applicable to horse-race betting operators in breach of those regulations:

  1. penalty;
  2. fine; and
  3. revocation of licence.

Article 50 of the Misdemeanour Law establishes that the operation of games of chance in a public place or in a place available to the public is subject to imprisonment, from three months up to one year, and a fine. In addition, introducing foreign lotteries in Brazil with the objective of sale, results in a penalty of a prison term of between four months and one year, and a fine (Article 52).

Taking part as a player in illegal gambling may result in a fine. As Article 50 of the Misdemeanour Law has been recently amended by Law No. 13,155 of 4 August 2015, it is now the case that players and affiliates involved with online or offline illegal gambling are subject to a fine ranging between 2,000 and 200,000 reais.

The penalty for advertising unlicensed lotteries is a fine. According to Article 50 of the Advertising Self-Regulation Code of the National Council for Advertising Self-Regulation (CONAR), any advertising that 'induces to criminal or illegal activities' is subject to penalties that may include a warning, a recommendation to modify the advertisement and a recommendation to suspend it.

Those who operate international payments to offshore gaming companies without due reporting to the Brazilian Central Bank (and consequent payment of taxes) may also be held liable for unreported remittance of funds, according to Article 22 of Law No. 7,492 of 16 June 1986, subject to imprisonment from two to six years and a fine, plus the payment of all due taxes.


The Brazilian Civil Code classifies bets as contracts, therefore only those over 18 years of age are legally allowed to gamble. This is also set forth in the Brazilian Child and Adolescent Protection Statute, which rules that venues where billiards and snooker are played, and venues where bets are made, should not permit children and teenagers to enter.

Although they are not specifically aimed at gambling activities, general advertising rules in Brazil that may have an impact on gambling are included in Decree-Law No. 57,690 of 1 February 1966 and Decree-Law No. 4,563 of 31 December 2002, and anti-money laundering rules in Law No. 9,613 of 3 March 1998 and Law No. 12,846 of 1 August 2013.

Article 1 of Law No. 9,613/1998 defines the crimes related to laundering or concealment of assets, rights and valuables as:

Concealment or dissimulation of the nature, origin, location, availability, handling or ownership of assets, rights or valuables directly or indirectly originated from criminal activities.

According to Article 10 of the same law, all companies that pay prizes are obligated to identify their clients and keep records for at least five years. Brazil has been a member of the Financial Action Task Force since 2000. Brazil has also been a member of the Financial Action Task Force of South America since 2000.

Law No. 12,846/2013 is the anti-corruption law in Brazil, which focuses on companies (either Brazilian or foreign) with operations in Brazil. This law created civil and administrative responsibilities, as well as criminal responsibilities, and may be compared to the UK Bribery Act.


Lotteries are not taxed, since they are owned and operated by the state. Their revenues, however, have pre-established social destinations set forth by law, such as funds for sports, education, health, culture, etc.

Jockey clubs, as non-profit entities, pay ordinary corporate taxes (with exception to the taxes on income), and the contribution to the Coordination Commission for National Horse Breeding of 1.5 per cent of the adjusted net win (wagers minus prizes for winning bets minus prizes for horsemen).

The gamblers are also taxed. As per Article 676 of Decree Law No. 3,000 of 26 March 1999, all prizes paid for lottery and horse-racing winnings are subject to an exclusive withholding income tax of 30 per cent of the prize amount.

Poker prizes, on the other hand, are subject to a different income tax withholding. According to the Brazilian Revenue Service,9 whenever the prize depends on the performance of the participants, it is deemed as remuneration of the work, regardless of whether the prizes are paid in cash or in the form of goods and services. Therefore, if the prize is paid by a Brazilian legal entity to an individual fiscally resident in Brazil, it will be subject to personal income tax withholding calculated based on the following progressive tax rates:10

Income at or over (reais)Up to (reais)Tax rate (reais)Deductible tax amount (reais)
4,664.68 and above27.5869.36

Sports betting and casino winnings obtained by Brazilian players on offshore websites or land-based operators are subject to taxation in Brazil, under the same percentages indicated in the chart above.

Law 13,756/2018 sets forth that all prizes from the fixed-odds sports betting lottery that are above the exemption limit of the personal income tax (1,903.99 reais) will be subject to 30 per cent income tax withholding.

Advertising and marketing

Article 57 of the Misdemeanour Law expressly rules that publishing, even if indirectly, the operation or results of unauthorised lotteries in newspapers, radio or any other format is a contravention, punishable by a fine. As to other forms of gambling, there is no express reference to advertising restrictions in the criminal law.

Decree-Law No. 57,690 of 1 February 1966 and Decree-Law No. 4,563 of 31 December 2002 regulate advertising in Brazil and, according to the latter, all advertisement in Brazil must comply with the rules set forth by the Standard Rules Executive Council (CENP).11 This council is responsible for regulating the commercial relations between advertisers and agencies, while CONAR is responsible for ensuring ethics in advertising content.

Both CENP and CONAR are non-governmental organisations formed by members of the advertising industry to define their own statutes and codes. CONAR's Self-Regulation Code also includes a general rule that advertisements should not contain anything that 'induces criminal or illegal activities' (Article 21).

Based on this general rule, many gaming and poker companies have faced difficulties trying to advertise in Brazil. In 2009, CONAR prohibited Full Tilt Poker from advertising on the Discovery Channel. That decision was based on the assumption that poker was a game of chance, illegal in Brazil. After deliberation, CONAR decided that poker is a game of skill, and allowed the advertising. In that same year, CONAR also prohibited Sportingbet from advertising in Brazil. This prohibition was upheld by the Brazilian courts after it was challenged by Sportingbet.

In several situations when CONAR suspended advertising of sports betting companies located and licensed in other countries based on Article 21 of the Brazilian Code of Advertising Self-Regulation, these decisions often ignored the territoriality rule of Article 2 of the Criminal Offences Act itself, which prevents this criminal law from being applied to acts committed outside national territory.

As a result, companies headquartered abroad have been operating with websites in Portuguese and accepting bets from Brazilian internet users for years, advertising websites without any betting content, such as statistics pages or sports tips. As a rule, there has not been any restriction for advertising social gaming websites (the '.nets'), since their activity is legal in Brazil.

With the approval of Law 13,756 in December 2018, the legal ground used by CONAR to prevent the advertising of betting sites is no longer valid as sports betting is no longer illegal. One consequence of the legalisation is that some soccer teams are already being sponsored by sports-betting companies.

As explained, contest regulation is subject to federal jurisdiction in Brazil: whenever a contest is held to promote the sale of products or to promote brands, it is deemed as a prize promotion, subject to Law No. 5,768, of 20 December 1971, Decree No. 70,951 of 9 August 1972, and Law 13,756, of 12 December 2018. The following ordinances also apply:

  1. Technical Note 11/2018/COGPS/SUFIL/SEFEL-MF provides for an explanatory list of cases in which the free distribution of prizes depends on the prior authorisation of the Secretariat of Fiscal Monitoring, Energy and Lottery;
  2. Ordinance MF 67, of 31 July 2017 establishes that all authorisation requests addressed to the Secretariat of Fiscal Monitoring, Energy and Lottery must be made online, through the Prize Promotion Control System;
  3. Ordinance MF 422 of 18 July 2013 establishes the cases in which contests are not deemed as exclusively artistic, cultural, sportive or recreational for free prizes or awards distribution purposes; and
  4. Ordinance MF No. 41 of 19 February 2008 regulates the free distribution of prizes for advertisement purposes, when performed by raffle, gift certificates, contests or similar operations.

The four types of free distribution of prizes to consumers are outlined in more detail below:

  1. Raffle: raffling elements are distributed, numbered in series, and those to be awarded are defined based on the results of the extraction of the federal lottery or on a combination of numbers from such results.
  2. Gift certificates: gift certificates are randomly hidden inside a product or the product's respective package. The gift certificate will be exchangeable for the prizes in the exchange stations.
  3. Contests: contests are based on forecasts, calculations, intelligence testing, games of skill or competitions of any nature.
  4. Similar operation: type conceived from combination of factors suitable to each one of the other types of prize promotion, preserving the original concepts for qualifying competitors and verifying the winners. It may be presented as 'similar to contest', 'similar to gift certificate' and 'similar to raffle'.

Contests for advertising purposes must be authorised by the Ministry of Economics' Secretariat of Fiscal Monitoring, Energy and Lottery (SEFEL).

In order to avoid fraud or confusion between cultural contests and prize promotions, the Brazilian Ministry of Economics has defined some procedures to assess whether a contest is considered to be a prize promotion or not. Ministerial Ordinance No. 422 of 18 July 2013 sets forth the cases in which a contest loses its exclusive artistic, cultural, sportive or recreational aspect and becomes a prize promotion (subject to the applicable rules and previous authorisation).

The year in review

The year 2018 was a presidential and legislative election year in Brazil, so it was expected that no gaming regulation initiative would progress much. The fact that no company showed for the first public tender of LOTEX was a huge disappointment for the regulator, and a victory to CAIXA, for the preservation of its monopoly, and for the states' lotteries, which are challenging the federal monopoly on instant lottery products. The LOTEX tender was postponed and took place in May 2019, again with no company making an offer. As result, the Brazilian government will need to reconfigure the business model and will probably low the financial and technical requirements to allow more participants in a future attempt to privatize LOTEX.

The biggest surprise was the approval of Law 13,756/2018, in December 2019, legalising sports betting in the country, which is still subject to further regulation.

The way and the speed in which sports betting was approved confirms our understanding that the definition of which types of games should be legalised in our country will depend on the government, as much as, or even more than, congress. With the support from the Ministry of the Economy, sports-betting legalisation was included in the conversion of Provisional Measure 846/2018 into Law 13,756/2018 and in less than a month it was approved without any significant obstacle.


With the failure to privatise LOTEX, the Brazilian government will need to reconfigure the business model and will probably low the financial and technical requirements to allow more participants in a future attempt to privatize LOTEX.

The Ministry of the Economy's Secretariat of Fiscal Monitoring, Energy and Lottery is already working on the regulation of sports betting. We expect to have at least a first draft of the regulation presented to the industry until the end of this year. Licences are expected to be issued from 2020.

Meanwhile, in the legislature, two bills regarding gaming are under discussion: Bill 442/1991, from the Chamber of Deputies, and Bill 186/2014, from the Senate.

During the conversion of the Provisional Measure No. 671/2015 into Law 13.155, of 4 August 2015, fixed-odds sports betting was approved by the Congress and vetoed by the former President Dilma Roussef under the justification that 'the creation of the fixed-odds lottery demands a broader regulation to assure better economic and legal security and adequate levels of fraud and money evasion control. Besides, the law didn't contain any responsible gaming measures'.

After vetoing the Article that was meant to create fixed-odds sports betting, back on 14 September 2015, the former President held a meeting with congressional leaders to assess the feasibility of getting the gaming offering approved by both houses. Subsequently, the President of the Senate introduced Bill of Law 186/14 from the Senate in the Special Commission for National Development (Commission of the Senate). A few days later, another special commission (Commission of the Deputies) was created in the Chamber of Deputies to draft the Brazilian Gaming Regulatory Framework, based on another project, the Bill of Law 442/1991.

On 30 September 2015, the President of the Senate, Renan Calheiros, included Bill of Law 186/2014,12 drafted by Senator Ciro Nogueira, among the topics discussed by the Special Commission for National Development (CEDN), which led to a fast-track procedure to obtain approval for strategic bills, which are needed for the overall improvement of the economy (the 'Agenda Brazil').

On 28 October 2015, the Chamber of Deputies created another Special Commission to draft the Brazilian Gaming Regulatory Framework. Since then, the Commission has been holding weekly meetings and hearings.

On 9 December 2015, the CEDN Commission approved the substitutive Bill of Law presented by Senator Blairo Maggi and on 10 March 2016 the Bill of Law received five new amendments, which means it can be voted on in the Senate.

After extensive discussion, on 30 August 2016, the Commission of the Deputies approved the report on the new draft of Bill 442/1991, which was sent to the Chamber of Deputies' plenary and is ready to be scheduled for vote.

Also in August, Bill of Law 186/2014 was returned to the Senate and its draft was replaced by a new version, presented by Senator Fernando Bezerra, its new rapporteur.

Senator Fernando Bezerra presented several versions of the draft, the latest on 4 November 2016. On 9 November, the Commission of the Senate finally approved Bill of Law 186/14, and on 14 December a request from Senator Magno Malta was approved.

On 13 December 2016, several experts were invited to speak at the General Commission of the Chamber of Deputies about gaming regulation.

Bill of Law 186/2014 was rejected by the Justice and Constitution Commission on 7 March 2018 by a vast majority of 13 against it and only two senators in favour (the rapporteur and Senator Ivo Cassol) and archived due to the end of the last legislative term. Despite such a defeat, the Bill is currently ready to be presented at the plenary for vote, because Senator Ciro Nogueira requested and obtained its retrieval from the archive.

As one can see, both Bill 442/1991, from the Chamber of Deputies, and Bill 186/2014, from the Senate, may be presented in the plenary of each house to be voted anytime. Once a bill of law is approved in the floor of one of the houses, it will have to be approved by the other house. If amended, it will need approval by the house of origin before being subject to the President's sanction.

Bill of Law 442/1991Bill of Law 186/2014
OriginChamber of DeputiesSenate
StatusApproved by the Special CommissionDraft proposed by the rapporteur, Senator Benedito de Lira was rejected by the Justice and Constitution Commission
Next stepsVoting in the Plenary of the Chamber to be scheduledVoting in the Plenary of the Senate to be scheduled
Fixed-odds sports betting
Online gaming
Jogo do Bicho
Jogo do Bicho
Video-Bingo (Class II machines) and video-jogo (VLTs), both land-based and online
Casino resorts
Sports betting and other non-sports related types of betting, both land-based and online
Online casino games
LicencesCasinos: public bid for concession – 30-year term, renewable for equal terms.
Bingos: authorisation for 20 years, renewable for one equal term.
Jogo do bicho: 5 million reais minimum paid-up capital. Unlimited time licence.
Lotteries: states may have bids for concession of lottery services with 20-year term.
Online gaming: not defined.
VLT: 20 million reais minimum paid-up capital. Type of licence not defined.
All gaming modalities must be approved by the federal government.
Casinos, sports betting and online games are licensed by the federal government.
Bingos are licensed by the states and the federal district.
Jogo do Bicho and VLTs are licensed by the municipalities.
The procedures and criteria for licensing are to be determined by future regulation.

In the southern state of Rio Grande do Sul, a court decision has stated that gambling is not prohibited because the prohibition set out in Article 50 of the Misdemeanor Act of 1941 would be unconstitutional. The public attorney has appealed that decision and now the case is pending judgment by the Federal Supreme Court,13 where it has been granted 'general repercussion' effects, which means that the decision of this case will be binding to all other similar cases in the country.

Until the judgment is released, the effects of the prior decision from the Rio Grande do Sul court remain in force. As a result, many unregulated bingo halls have opened in that state. This lack of regulation may result in political pressure on the state, but depending on how the operators behave, it may create the opposite effect.


1 Luiz Felipe Maia is founding partner at FYMSA Advogados. The information contained in this chapter was accurate as at May 2019.

2 Brazilian Institute of Geography and Statistics. Projection of the population of Brazil and Federative Units. Accessed on 4 April 2017. Available at

3 World Economic Forum. The world's 10 biggest economies in 2018. Accessed on 11 April 2019. Available at

4 Luiz da Cunha Gonçalves, Tratado de Direito Civil, Volume 8, Tomo I, São Paulo, Max Limonad (1956) p. 380.

5 Clóvis Beviláqua, Direito das Obrigações, third edition (1931).

6 Pablo Stolze Gagliano and Rodolfo Pamplona Filho, Novo Curso de Direito Civil, Volume 4, São Paulo, Saraiva (2012), pp. 597–598.

7 Humberto José da Nova, 'Comentários à Lei das Contravenções Penais. Das contravenções relativas à polícia de costumes', Anais do 1º Congresso Nacional do Ministério Público, Volume 6. Rio de Janeiro, Imprensa Nacional, (1943), p. 149.

8 Rcl 9134 – Rio de Janeiro, Federal Supreme Court, Min. Ellen Gracie. Judgment dated 15 February 2009. Accessed on 7 April 2017. Available at

9 Solução de Divergência COSIT No. 9, de 16 de julho de 2012.

10 For reference, according to Law 9,779/1999, Article 7, non-resident taxpayers are taxed on Brazilian-earned income at a flat rate of 25 per cent (no deductions are allowed).

11 CENP, Standard Norms for Advertising Activities, São Paulo, 16 December 1998. Accessed on 7 April 2017. Available on

12 Federal Senate, Legislative Activity. Bill of Law No. 186 of 2014. Accessed on 7 April 2017. Available at

13 Extraordinary Appeal 966.177 RG/RS.

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