Pixbet wins legal reprieve in Brazil following suspension

Recent Developments in Brazilian Online Betting: Pixbet’s Licence Controversy

On April 11, the Secretariat of Prizes and Bets (SPA), Brazil’s regulatory authority for the gambling sector, suspended the licenses of four operators, including Pixbet. However, a decisive ruling from a federal court has reinstated Pixbet’s authorization to operate within the online betting market.

The SPA’s issuance of Normative Ordinance No. 787 led to the suspension of licenses for Tqj-Par Participacoes Societarias SA, 7MBR Ltda, Caixa Lotteries SA, and PixBet Technological Solutions. As a result, these operators were prohibited from engaging in fixed-odds betting, a key segment of the legal online betting landscape in Brazil. This suspension was enacted due to alleged non-compliance with Article 3 of Normative Ordinance No. 2,104, which mandates that operators submit technical certifications and adequately demonstrate their betting system’s compliance to the regulator.

Pixbet’s Licence Reinstated by Federal Court

In an official statement to Poder360, Pixbet expressed surprise at the suspension, contending that it had provided all necessary documentation to comply with regulatory requirements. The company indicated that it believed the suspension might stem from an inadvertent administrative error during the review process.

This unexpected suspension could have significant implications beyond Pixbet itself, particularly for prominent sports entities such as the famed football club Flamengo. Just last week, Flamengo launched its new shirt sponsor, FlaBet, in collaboration with Pixbet. According to Brazilian regulations, only properly licensed betting operators can sponsor professional sports teams, heightening the stakes of this situation.

Fortunately for Pixbet, federal court judge Anderson Santos da Silva intervened, overturning the effects of the ordinance on the same day as the suspension. The court ruling followed the filing of a “writ of mandamus” by Pixbet, which pioneered its appeal on the grounds that it had submitted three out of the four requisite certification documents in February, with the integration certificate submitted just a day before the suspension.

Pixbet characterized the SPA’s ordinance as “illegal and disproportionate,” asserting that it had resulted in serious reputational and financial damage, particularly in light of its BRL 470 million master sponsorship deal with Flamengo.

Judge da Silva ruled that Pixbet could immediately “resume their economic activity,” thereby suspending the enforcement of Normative Ordinance No. 787 pending further judicial review. Meanwhile, Tqj-Par Participacoes Societarias, 7MBR Ltda, and Caixa Lotteries SA will remain suspended until they submit the required certification documentation to the SPA.

This incident highlights the dynamic and often complex nature of the Brazilian online gambling regulatory environment, necessitating that operators maintain stringent compliance with evolving legal standards while managing partnerships within the sports sector. As the industry continues to grow, the need for clear communication and robust regulatory adherence will remain paramount for all stakeholders involved.

To encapsulate, this development not only affects Pixbet but serves as a critical reminder of the ongoing challenges and regulatory hurdles that operators within Brazil’s betting market encounter. As the landscape becomes increasingly competitive and regulated, maintaining transparency, compliance, and agility in operations will be essential for sustained success. It will be interesting to monitor how the remaining operators will navigate their situations and the broader implications for Brazil’s gambling industry moving forward.