Brazil Urged to Emulate Colombia’s Online Gambling Regulations for a Sustainable Market

Latam gambling expert Thomas Carvalhaes emphasizes the need for Brazil to adopt a regulatory framework similar to that of Colombia to establish a sustainable and well-regulated online gambling market. Carvalhaes, the managing director of Brazilian online betting operator Vai De Bob and a seasoned professional in the industry, has previously assisted global brands like Hero Gaming and LeoVegas in establishing their presence in Brazil and other Latin American markets.

Concerns Over Unfair Regulatory Proposal in Brazil

During a Latam-focused panel at iGaming NEXT Valletta 23, Carvalhaes expressed concerns about the recently proposed regulations by the Brazilian government, which he believes will hinder the creation of a fair and sustainable market. The proposal includes a steep licensing fee of R$30m for sports betting, a 16% tax on gross gaming revenue (GGR), and an additional 30% tax on customers’ winnings. Carvalhaes deems the fee and taxes unfair, particularly for smaller operators, predicting that it may drive them towards operating in a massive black market, similar to what happened in Mexico.

Need for National Regulation in Brazil

Despite the unfavorable reception of the current proposals, they offer some level of certainty for the future of the Brazilian gambling market. While sports betting was legalized in Brazil in 2018, a nationwide licensing regime and regulatory framework are yet to be implemented. Presently, some states have independently issued licenses to betting operators based on their own interpretations of existing lottery regulations. The fragmented approach, with state and federal lawmakers divided and ongoing political turmoil, has created a chaotic situation resembling a soap opera, as Carvalhaes describes it. To mitigate risks and ensure a robust betting sector, Carvalhaes emphasizes the necessity of national-level regulation for sports betting.

Emulating Colombia as a Promising Model

Carvalhaes suggests that Brazil should look to Colombia as a prime example to follow in Latin America. Colombia’s well-defined regulations have fostered a competitive and thriving online gambling sector since its launch in 2017. Carvalhaes highlights Colombia’s target audience with a high propensity for gambling, over 80% internet penetration, and its status as a technology hub in the region. Clear regulations in Colombia ensure a straightforward approach for operators, involving a 16% tax payment to the government and local regulator Coljuegos. Carvalhaes concludes that most operators in Colombia are satisfied with the results, making it an ideal model for a well-regulated market.

Ongoing Discussions for Brazil’s Regulatory Framework

The development of a nationwide regulatory framework in Brazil remains an ongoing discussion. Current predictions indicate that regulations may be introduced by 2024, with the aim of establishing a more cohesive and structured approach to online gambling in the country.