Esportes da Sorte to operate throughout Brazil after court injunction

Esportes da Sorte Secures Federal Court Injunction to Operate in Brazil’s Licensed Betting Market

In a landmark decision, the Federal Court of the Federal District has granted Esportes da Sorte a pivotal injunction, enabling the company to operate within Brazil’s licensed betting market, despite currently holding only a state lottery license. This ruling marks a significant development in the Brazilian gambling landscape.

On January 13, the Federal Court’s decision empowers Esportes da Sorte Group to roll out its brands, Esportes da Sorte and OnaBet, across Brazil’s national market. This authorization comes even in the absence of a federal license or provisional approval to engage in the legal online betting framework.

Previously, on January 3, Federal Supreme Court minister André Mendonça issued a preliminary ruling that prohibited Rio de Janeiro State Lottery (Loterj) licensees from offering gambling services nationally. This created a challenging environment for operators relying on state licenses to expand their reach within Brazil.

Esportes da Sorte initially secured Loterj authorization in August 2024, following the acquisition of controlling shares in ST Soft, a platform licensed by Loterj. However, the recent Federal Court ruling guarantees that Esportes da Sorte will be granted special authorization to operate nationally, with a mandate for publication in the Official Gazette of the Union within 72 hours post-decision.

In a statement to BNL Data, Esportes da Sorte expressed that the ruling highlights its adherence to Brazil’s gambling regulations: “This decision confirms that the company, from the beginning, complied with all legal and regulatory procedures established by legislation and its respective ordinances,” the statement read.

“Grupo Esportes da Sorte reaffirms its commitment to regulating the sector and ensuring responsible gaming, all while protecting the interests of civil society and contributing to the economic, social, and cultural development of our country.”

Understanding Esportes da Sorte’s Previous Ban

In September 2023, several events unfolded leading to Esportes da Sorte’s initial ban in Brazil. Owner Darwin Henrique da Silva Filho and his spouse were arrested during ‘Operation Integration,’ which investigated allegations of money laundering and illegal betting activities. Despite the company’s insistence on its innocence, the Sports and Gaming Authority (SPA) excluded Esportes da Sorte from the list of approved operators permitted to engage in betting activities between October 1 and December 31, 2024, rendering its operations illegal.

However, following the acquisition of controlling shares in ST Soft, Esportes da Sorte made its way back onto the SPA’s list of approved operators. Yet, as the SPA’s transition period concluded in December, the company was once again declared illegal for not being included among the 14 initial licensees or the 52 companies granted provisional authorization prior to the market’s scheduled launch on January 1.

The SPA’s denial of Esportes da Sorte’s operating request stemmed from the ongoing allegations associated with ‘Operation Integration.’ Nevertheless, Article 5 of Brazil’s constitution asserts that “no one shall be considered guilty before the criminal conviction becomes final and unappealable.” Without any final criminal convictions against the company, the Federal Court ruled in favor of granting Esportes da Sorte the necessary authorizations for nationwide operations. The ruling also prohibits the SPA from imposing further obstacles to Esportes da Sorte’s operations until any potential conviction may arise.

“The federal court found the denial of Esportes’ application to be illegal, particularly since the company had already paid the requisite license fee, and its website is set to transition to the new domain www.esportesdasorte.bet.br shortly,” the company elaborated.

The implications of this ruling extend beyond Esportes da Sorte alone. Football clubs such as Corinthians and Grêmio, which are sponsored by Esportes da Sorte, also stand to benefit significantly. The exclusion of Esportes da Sorte from the legitimate betting market would have posed a substantial challenge for these teams, as Normative Ordinance No 1,231 restricts sponsorship to licensed entities only.

Athletico Paranaense recently halted its sponsorship agreement with Esportes da Sorte, seeking clarification on the “recently reported facts” amid the uncertainty of the licensing situation. In contrast, Corinthians has continued to support Esportes da Sorte, affirming, “Sport Club Corinthians Paulista reaffirms its trust in Esportes da Sorte, our sponsorship partner, which has been fully complying with the contract.”

This ongoing legal battle highlights the complexities of the evolving Brazilian gambling market and underscores the importance of regulatory compliance and the need for transparent operations among industry stakeholders.