Brazil Betting Ban: 85 Licences Lapse as Lula Wins a Fourth Term
Brazil's licensed betting operators woke up on Monday without their licences, a day after President Luiz Inácio Lula da Silva won a fourth term on a campaign that turned the country's new betting ban into a vote of confidence.
- Lula beat Flávio Bolsonaro with 51.79 per cent of valid votes in Sunday's run-off, the first time a candidate who finished second in the first round has gone on to win the presidency.
- The 85 licences issued under Brazil's regulated market lapsed on 25 October, 30 days after Provisional Measure 1,394 banned fixed-odds betting and online casino, with no refund of the BRL30 million fee each operator paid.
- The ban now rests with the Supreme Federal Court, whose rapporteur promised a ruling after the election, and with Congress, which must vote on the measure by 25 November or let it lapse.
With every ballot counted by the Superior Electoral Court, Lula took 64,256,232 votes against 59,826,041 for Flávio Bolsonaro, a margin of about 4.4 million, R7 reported. Bolsonaro had led the first round with 47.03 per cent to Lula's 45.16 per cent.
Betting was at the centre of the run-off. Lula signed Provisional Measure 1,394 on 25 September, nine days before the first round, calling the ban a "harsh, drastic and necessary" step to protect indebted families. His campaign described the election as a referendum for or against betting, and on the eve of the second round he promised that betting would not come back, iGaming Business reported. The industry had expected a Bolsonaro win and was already negotiating changes to the measure with his team.
Licences Gone, Fees Not Returned
The measure gave the government 30 days to revoke the licences, and that deadline passed on Sunday. Each licence cost BRL30 million (about $6 million) for a five-year concession, plus a BRL5 million security deposit, and almost 190 brands had been operating under the 85 licences. None of the fees will be refunded.
"On 25 October, contractual agreements designed to last five years will be abruptly interrupted, without any maturation period or return on investment," said Carlos Lima, president of the Brazilian Institute for Responsible Gaming (IBJR). He put the total paid in licence fees at almost BRL2.6 billion, with a further BRL7.5 billion in capital invested by operators.
Operators stopped taking deposits and bets the night the measure was published and have lost about BRL1.2 billion in revenue since, while the government has given up more than BRL400 million in tax, according to iGaming Business. An industry survey has already linked the ban to more than 3,500 jobs lost.
The Supreme Court Decides First
The first test is in the Supreme Federal Court (STF). Trade bodies IBJR and ANJL asked the court to suspend the measure on 28 September, followed by broadcasters' association Abert and several football clubs. Justice Luiz Fux, the rapporteur, has said he will rule once the election is over. The Attorney General's Office defended the ban before the Supreme Court on 6 October.
If the STF strikes the measure down, the revocation of the licences would also fall. Operators are fighting on other fronts too: Stake is contesting a federal court decision that reversed an injunction it had won against the ban.
Congress Holds the Other Key
Congress has until 25 November to vote on the measure and can extend that by 60 days. From 9 November, the measure will block the legislative agenda until it is voted on. The joint committee that must examine it has named members but has no president or rapporteur and has not yet been installed.
Nearly 100 amendments have been tabled, and most would keep sports betting legal while dropping online casino. Lula's opponents in Bolsonaro's Liberal Party hold the largest blocs in both houses, which makes it harder for the government to keep the measure alive, and even if Congress restores sports betting, it is unclear whether operators would need to apply and pay for new licences. The government has also sent Congress a separate bill that would make running a betting operation punishable by four to six years in prison.
Clubs and the Black Market
Football is among the hardest hit. Flamengo's shirt deal with Betano was worth BRL268 million a year until 2028, and club president Luiz Eduardo Baptista asked publicly how he would pay his players in January, Coluna do Fla reported. The government is preparing a BRL20 billion credit line for clubs.
Lima warned that bettors will not stop betting. The illegal market was already estimated at 38 to 44 per cent of the total before the ban, according to LCA Consultores, and there are more than 30,000 illegal sites aimed at Brazilian players. "These operations do not collect taxes in Brazil, do not require identity verification or facial recognition," he said. The ban has already hit the results of listed operators such as Entain, and with Lula's mandate renewed until the end of 2030, the sector's hopes now rest on the courts and Congress rather than the ballot box.
