Rodrigo Maia, President of Brazil’s Chamber of Deputies and representative of Rio de Janeiro state, has promised his allies in the lower chamber of Congress that he will hold a vote on a bill to legalize casinos and gambling. According to local news magazine Veja, the vote would come as a critical milestone in what has become a
drawn out campaign to enact enabling legislation over the past 18 months.
While the Brazilian government is in dire need of the revenues that legalized gambling and integrated resorts could potentially offer, the push has been sidetracked amid political turmoil and corruption scandals of historic proportion.
Nevertheless, Veja reports that momentum in the chamber has been building for some time, and a
bloc of 262 deputies has formed to promote a bill that would legalize casinos and other forms gambling.
One such deputy, Nelson Marquezelli from Sao Paulo, reckoned that construction could begin as soon as next year if enabling legislation were to be passed before the end of 2017.
Maia’s promise comes on the heels of the formation last week of the Parliament Front for the Approval of the Regulatory Framework for Gambling in Brazil, a group that aims to promote Bill 442/1991 – which would legalize casinos for tourism purposes and other forms of gambling.
This bill is more expansive than a narrower alternative that has also been introduced. President Michel Temer has reportedly agreed to sign off on whichever bill Maia and the Chamber of Deputies
decide to pass.
"We believe that last week’s events were very important for the improvement of the Gambling Legalization in Brazil, giving for everybody a new hope that it will happen soon,” said Edgar Lenzi, president of Curitiba-based BetConsult.
A companion bill in the Senate has been waiting since last spring to be analyzed by an independent body that will assess its constitutionality.
Another big step occurred in September when the Brazilian government announced that it is moving ahead with plans to privatize its lottery, which is currently owned by a subsidiary of the state-owned Caixa Economica Federal.
The initial indications were that a call for bids would be issued in October, but that timeframe has since been pushed back to late November or early December pending some legal approvals. The auction itself, originally slated for December, will now likely be held in January or February 2018.
"This would mark a significant step towards the commercialization of gambling in Brazil,” wrote John DeCree of Union Gaming Research in a recent note. He notes that more than 10 multinational actors, a number that includes major manufacturers like Scientific Games,
IGT and Intralot, have expressed in bidding on the concession, though it remains to be seen whether many will actively bid.
"It appears from our discussions that many of the major suppliers are still noncommittal on whether they would participate in the auction given some degree of uncertainty surrounding the regulatory landscape in Brazil and market opportunity,” DeCree said.
The $300 million minimum bid set by the government and the requirement that 15 percent of any bidding consortium must be owned by a company that has large-scale lottery operating experience are the largest hurdles that potential bidders must confront.
"While the sheer size of the market is attractive (with over 200 million residents), the sizeable upfront fee is something potential bidders will need to manage carefully given how competitive the auction might be with over ten parties expressing interest thus far,” DeCree completed.
Source: GMB / CDC Gaming Reports
