In recent months, betting has become the target of intense criticism in the media, allegedly responsible for various negative impacts in Brazil, such as family over-indebtedness, reduced consumption of essential goods, worsening conditions for Bolsa Família beneficiaries, and even being the primary cause of the rise in divorces.
At the end of September, after this narrative of vilification of the betting industry had consolidated, the CNC (National Confederation of Commerce of Goods, Services, and Tourism) filed Direct Action of Unconstitutionality 7721 in the Supreme Federal Court, aiming at declaring Law 14.790/2023, known as the Fixed-Odds Betting Law, unconstitutional. This was based on assumptions about the effects of betting on the economic, social, and public health order, which would disproportionately affect the most vulnerable social classes.
In summary, the anti-betting narrative drastically shifted direction over the last month. The discourse that once focused on the importance of regulating betting activities to protect consumers has now shifted to advocating for the complete prohibition of the activity again, as if such an extreme measure would solve all the previously raised issues.
On the contrary: Brazilians were already betting online before the activity was legalized in 2018. What will happen is what existed before (and still persists): Brazilian consumers betting on illegal and unregulated betting websites, which will only gradually increase the negative impacts that are currently dominant.
It is necessary, first and foremost, to question to what extent these criticisms are genuinely grounded or whether they simply reflect rhetoric that distorts the facts, aimed solely at tarnishing the image of the betting industry to benefit the economic interests of other sectors.
Many of these criticisms, based on weak perceptions, lack a more objective analysis, especially given the barrage of information disseminated through various media outlets. The central issue does not lie in the nature of betting itself, but in the absence (and delay) of proper regulation of the activity.
State inertia
The enactment of Law 13.756/2018, which legalized sports betting in Brazil, triggered a profound shift in consumption dynamics in the entertainment sector. Since then, the market has grown exponentially, attracting a large portion of the population to engage in betting.
However, what is often not disclosed, or emphasized as it should be, is the six-year limbo between the legalization of the activity in December 2018 and the beginning of the regulated market in January 2025.
The 2018 legislation expressly stipulated a two-year period, extendable by another two, for regulating the activity – which was not done. Had the regulation been implemented during this period, it would have extinguished – or at least significantly mitigated – the vast majority of the problems we face today.
Brazil is not reinventing the wheel by legalizing betting. Of the 38 OECD countries, only Iceland has not legalized betting. Of the G20, only Brazil, along with Saudi Arabia and Indonesia—both Muslim countries—have not yet legalized or regulated betting. It is unlikely that the entire world is wrong, and that Brazil is right in keeping such an economic activity in illegality.
Prohibiting the activity in Brazil will not solve the problems being raised today. Quite the opposite; the public figures who currently advocate for the protection of the popular economy and the treatment of those suffering from gambling addiction will magically disappear and will do what they did during all the past decades of prohibited gambling: sweep the issue under the rug and ignore who, how many, and where the vulnerable people suffering from compulsive gambling disorders are.
If there was no broad, concrete, and effective action to assist and treat such vulnerable individuals during the past decades of prohibited gambling, it seems highly unlikely that any potential new prohibition will result in better forms of protection for these consumers.
Regulation to separate the wheat from the chaff
Regulating means bringing into the light what currently operates in the shadows, promoting more responsibility and transparency. The period without regulation has made one thing clear: there are indeed malicious betting operators whose intention is to exploit Brazilian consumers as much as possible, avoiding obtaining a license in Brazil, and continuing to operate in the shadows. For these operators, the longer the activity is banned or unregulated, the better.
On the other hand, there are numerous reputable operators who are regulated in various jurisdictions and submit to a legal framework and rigorous oversight from regulators around the world to operate within the rules.
These operators are interested in obtaining a license in Brazil, complying with regulatory requirements, and preventing “rogue operators” and unregulated entities from continuing to exploit the activity at the expense of Brazilian consumers, while tarnishing the reputation of the industry as a whole.
Just because Odebrecht, HSBC, and Alstom were convicted of money laundering, we shouldn't ban companies in the sectors of engineering/construction, financial services, and energy/transport infrastructure from existing or operating in these activities. Every sector has companies that tarnish the reputation of an entire industry, but we cannot buy into the narrative that they are all like this.
With the regulation of fixed-odds betting starting on January 1, 2025, Brazil is undergoing a period of adjustment, as established by Portaria SPA/MF 1.475 of 2024.
The formalization of this activity under the regulatory framework introduces a series of rules aimed at consumer protection and promoting social interest. These measures include the certification of platforms and games offered, prudential limits for betting, self-exclusion programs for at-risk bettors, education on responsible gambling, and continuous monitoring to prevent the participation of minors in betting.
Consumer education and responsible gambling
A large part of the problems faced today would be considerably mitigated with education, which is encompassed in the responsible gambling guidelines established in the ordinances of the Ministry of Finance's Secretariat of Prizes and Betting.
Because this is a relatively new economic activity, many myths need to be debunked, and the reality of the activity must be widely publicized. Once the population is properly informed about the activity and its potential harms, people should have the freedom to choose whether to bet or not.
Write this down in bold and all caps: BETTING IS ENTERTAINMENT. Advertising by regulated betting operators can never promote betting as a form of investment, a source of income, or personal enrichment. If they do so, they will be sanctioned through administrative proceedings, as determined by Law 14.790/2023.
For this reason, the ordinances from the Betting Secretariat already establish guidelines for responsible gambling and advertising for the sector, drawing inspiration from other jurisdictions that have already regulated the activity. It is important to note that influencers promoting betting operators must also observe these rules and SPA guidelines on responsible gambling and advertising, under penalty of being sanctioned as well.
Banning an activity is the easiest path for populist rhetoric; educating the population and implementing awareness policies is more difficult. Perhaps that’s why the discourse has shifted so abruptly.
The illusion of numbers
Recent studies on the impact of betting on consumption and the economy must be analyzed with greater caution, as they are based on speculative projections and incomplete data, resulting in narratives that distort the real dimension of the betting market in Brazil. The lack of active regulation compromises the acquisition of official data, making estimates of the economic and social effects premature and imprecise.
For example, CNC’s study focuses solely on direct financial flows, disregarding the funds held in bettors' accounts or the amounts returned as prizes. This creates the misleading perception that all wagered resources are removed from consumption, which does not reflect reality.
Itaú's research, on the other hand, adopts a more accurate approach by distinguishing between the total wagered amount and the net amount actually spent, estimated at R$ 23.9 billion—significantly lower than the gross value. However, it also fails to consider the amounts retained in bettors' accounts on betting platforms.
Itaú further demonstrates that retail sales remain within macroeconomic expectations, with no significant deviations, indicating that the impact of betting on essential goods consumption is much more limited than suggested.
In the study "The Impact of Sports Betting on Consumption" by PwC Brazil and Strategy& Brazil, it is claimed that operators retain a 12% rate of the wagered amount as GGR (Gross Gaming Revenue), which is incorrect because: 1) this rate will only be applied starting in January 2025 with the new regulation, and 2) the tax will be the responsibility of operators, not passed on to bettors. Moreover, the claim that “a significant portion of winnings is reinvested in new bets” lacks empirical evidence to support such behavior in the market.
Thus, the extrapolation of incomplete data to conclude on delinquency and loss of purchasing power exemplifies how the absence of regulation transforms conjecture into “truths” in public opinion. Only with the implementation of robust regulation will it be possible to obtain reliable data that provides a fair and realistic view of the impact of betting on Brazil's economy.
A path to development
A calibrated regulatory structure, as established by the SPA, is the only viable way to mitigate concerns about the potential negative impacts of betting.
Clear rules, combined with effective responsible gaming programs and assertive oversight, not only protect the vulnerable but also pave the way for economic development in the sector without compromising social interests. By adopting a solid regulatory framework, Brazil can position itself among the jurisdictions that skillfully balance public interest with market development.
The attempt to preemptively suspend and declare Law No. 14,790/2023 unconstitutional, as requested by CNC, perpetuates the regulatory vacuum that would only amplify the negative impacts. Instead of protecting consumers, this gap exposes society to greater risks by maintaining the power of "adventurous operators" who prefer to operate in the shadows of an illegal and unregulated market.
Thus, the enemy is not betting; it's the lack of regulation.
Udo Seckelmann
Lawyer and head of the Betting and Crypto department at Bichara and Motta Advogados, professor at CBF Academy, and holds a master's degree in international sports law from the Instituto Superior de Derecho y Economía in Madrid (Spain).
Pedro Heitor de Araújo
Law student at PUC-RJ, works in the areas of crypto & gambling at Bichara e Motta Advogados since 2022. As an analyst, researcher, and enthusiast, he dedicates himself to the legal dynamics related to the regulation of crypto-assets, DeFi (decentralized finance), betting, and gaming. He has completed courses in DeFi and non-fungible tokens (NFTs) at the University of Nicosia (Cyprus).
