Ministry of Finance limits the operations and advertisement of fixed-odds betting companies failed to apply for authorization before September 30, 2024
In brief
The Ministry of Finance (“MF”) issued a new regulation (Ordinance No. 1,475/2024), reducing the adjustment period for companies that operate fixed-odds lottery betting nationwide. Legal entities without MF’s authorization and/or that did not apply for authorization by September 30, 2024 are not allowed to operate since October 1, 2024, and this impacts application providers that allow advertising by these companies.
More details
Recently, the MF has issuing different regulations on Federal Law No. 14,790/2023, which governs the fixed-odds lottery betting modality – i.e., those in which the prize’s multiplication factor is defined prior to the bet.
Initially, the MF published Ordinance No. 1,233/2024, which addresses the commercial exploitation of the fixed-odds lottery betting modality, detailing the procedure for investigating infractions, including the how to notify the companies operating in that market during such procedure, defense deadlines, applicable appeals, and possible penalties. The Ordinance also allowed companies to take the necessary measures to comply until December 31, 2024.
Due to various pressures in recent weeks, on September 16, 2024, the MF issued a new Ordinance (Ordinance No. 1,475/2024), which prohibits fixed-odds betting operations by companies that have not applied for an authorization of the MF by September 30, 2024.
This change brings directly impacts application providers that allow advertisements of betting products. Law No. 14,790/2023 mandates the removal of advertisements from unauthorized companies in response to notifications from the MF with valid identification of the violating content. Violations of the Law can lead to various penalties (according to Ordinance No. 1,233/2024), mostly directed at betting companies, but some also applicable to application providers in case of non-compliance with the notification, mainly fines, although website’s suspensions are also foreseen. Additionally, there is legal discussion about the possibility of other penalties, such as civil and criminal.
This topic has also received attention from the Legislative, where three Bills of Law have been presented last week to regulate betting in Brazil, including the prohibition of having beneficiaries of Federal Government income transfer programs participating in sports betting and online gambling, and restrictions on betting advertising in the virtual environment.
