With a population of 214 million, and an almost unrivalled passion for sports - and football in particular - it is no surprise that Brazil has become one of the world’s biggest gambling markets, with millions of fans regularly searching online for the best new betting offers.
Regulation of this industry however lags well behind the pace of development – a subject which has increasingly been hitting the news headlines in recent months.
Lack of Regulation No Deterrent
Online gambling may not yet be regulated in Brazil, but that has not stopped swathes of foreign operators from extending their reach into the South American nation. Betting brands can be seen emblazoned across football shirts (no fewer than 20 top-flight clubs are now associated with a sports betting company), esports events, and more, as the names of these overseas brands seep further into the public consciousness.
Business is Booming
This increased presence certainly seems to be having an effect, with total transactions in the Brazilian betting market expected to hit R$ 12 billion in 2023. All of this, whilst the nation tries to decide if, and how, it wishes to regulate the online sports betting industry.
All Sorted in Time for the World Cup?
An unsatisfactory state of affairs all around, but one which was supposed to be sorted out before the looming World Cup – the government stating on numerous occasions that everything would be in place prior to the big kick-off in Qatar.
Back in 2018 a law to regulate the sector was approved during Michel Temer’s spell in office, with an initial date of implementation set at December 2020. As that date came and went, a new deadline was pencilled in for December of 2022.
Potential Costs of Inertia
Now less than a month before Qatar and Ecuador get things underway, this prediction is looking increasingly unlikely, with the plan having seemingly been shelved for now. The general election may be one reason behind this delay but, whatever the case, a failure to act seems set to come at a price.
Potential benefits of regulation are numerous, with advocates highlighting the positive effect a fully regulated industry would have upon:
However, the most immediate impact is set to be the loss of a potential financial windfall. A failure to regulate and tax such a valuable industry will always come at some sort of price in terms of lost potential revenue.
All The Worse in World Cup Year
In 2022 however, this effect can only be amplified. The FIFA World Cup is after all one of the biggest betting events on the planet. Brazilians, just like punters in many other nations, will bet on it whether or not it is regulated. This missed opportunity is perhaps best illustrated by the figures involved.
In a normal year, predictions suggest that a regulated industry could see the government coffers swell to the tune of $R 3 billion, with the sale of operating licences granting the opportunity to generate almost that amount again.
Meanwhile, the World Cup alone is expected to see over $R 20 billion staked by Brazilians – much of which could have been taxed had the government acted sooner.
