ANJL president warns legal betting operators may leave Brazil
Plínio Lemos Jorge, President of the National Association of Games and Lotteries (ANJL), has articulated a significant concern: if the illegal gambling market continues unchecked, it could drive legitimate operators out of Brazil.
During a recent briefing, Regis Dudena, the head of the Secretariat of Prizes and Bets (SPA) in Brazil, disclosed that 71 operators have successfully secured their license applications. Out of these, 16 companies have already remitted the BRL30 million (£3.9 million/€4.7 million/$4.9 million) concession fee.
The regulatory framework for the legal betting market is expected to be operational starting January 1, 2025. However, with this pivotal launch just weeks away, the ongoing threat posed by illegal operators remains a pressing concern.
Could Illegal Competition Force Licensees Out?
The ANJL has previously highlighted a troubling statistic: over 2,000 illegal gambling sites continue to function in Brazil. Carlos Baigorri, President of the National Telecommunications Agency (Anatel), has likened efforts to combat these illegitimate operators to “mopping up ice”—an almost futile endeavor.
Lemos Jorge warns that without a robust and effective approach to dismantle the black market, the presence of legal operators could dwindle. “This risk does exist if the illegal market is not effectively combatted,” he stated in an interview with UOL Apostas. “If investors evaluate the current market landscape as unfavorable regarding potential returns, those who are already active may reconsider their investments and exit the country.”
The proliferation of illegal operators not only threatens the sustainability of licensed businesses but also drastically undermines player protection.
“Illegal websites adversely affect the industry and society in several ways,” Lemos Jorge emphasized. “Their primary impact is predatory and unfair competition; these platforms evade taxes and forego the necessary operational costs associated with a regulated environment in Brazil.”
“Moreover, these clandestine entities prioritize profit over the welfare of bettors, neglecting critical issues such as responsible gaming and shielding minors from exposure to gambling activities.”
What Measures Could Be Taken in Brazil?
In light of the ongoing challenges, Anatel President Baigorri has advocated for enhanced authority to bolster site blocking initiatives. Recently, a cooperation agreement was signed between Anatel and SPA to strengthen their collaborative efforts.
Both the ANJL and Anatel convened to strategize potential measures to combat illegal operators, with actionable suggestions anticipated in the coming weeks.
Lemos Jorge advocates for an increase in Anatel’s powers to streamline the blockage process. “Granting Anatel greater autonomy through legislative means is essential,” he asserted. “Accelerating the blocking process will prevent illegal sites from becoming entrenched, thereby minimizing damages to bettors.”
Payment Blocking: A Promising Alternative
As Anatel grapples with the challenge of removing all illegal sites, payment blocking has emerged as a potentially more effective approach to disrupting the black market. Hugo Baungartner, CCO of Aposta Ganha, has previously argued that “the only truly effective method” to curtail illegal operations is through restricting payment avenues, given the rapid emergence of new unlicensed domains.
Pix, a real-time payment system regulated by Brazil’s Central Bank, has gained immense traction within the gambling sector due to its capability to facilitate transactions in mere seconds. Under the impending regulations, payments made via Pix to illicit operators will be prohibited.
Lemos Jorge concurs that payment blocking is a crucial component of the government’s strategy to combat illegal activities. “Addressing the payment methods that empower illegal sites to function is of paramount importance,” he stated. “Any financial institution that engages in transactions with these unauthorized platforms is also infringing upon the law.”
Lemos Jorge Remains Optimistic about Brazil’s Betting Future
Despite the persistent challenges posed by illegal operators, Lemos Jorge expresses confidence that the regulatory measures enacted by the SPA will foster a secure environment for betting activities in Brazil.
He articulated, “The regulatory framework established by national congress through Law 14,790/2023, as detailed in various ordinances published by the SPA, is considered amongst the most stringent and comprehensive globally. This feedback reflects a consensus within the industry.”
“However, it is imperative to implement a robust oversight mechanism that functions effectively in practice. We are optimistic that a collaborative effort among governmental and private sector stakeholders will be instrumental in mitigating illegal betting practices or, at the very least, significantly reducing their prevalence.”
