Exploring the advertising environment for online gambling in Brazil

The legal betting landscape in Brazil is undergoing significant transformations, marked by the enactment of Law 14790/2023. While brick-and-mortar casinos (including those on cruise ships) remain prohibited in the LATAM nation, online sports betting platforms and casinos will be able to apply for licensing from the federal government of Brazil to operate legally in the nation.

The bill permits operators to oversee a maximum of three brands within five years, with a fee of R$30 million. It facilitates the entry of established gambling firms into the Brazilian market and establishes a rigorous participation standard, ensuring that only committed and financially sound operators can engage.

This approach aims to foster a competitive market while emphasising the seriousness and financial stability necessary for entering Brazil's market. Read on to learn more about these stipulations.

Key aspects of the sanctioned law include:

Taxes

In addition to regular corporate taxation, sports betting and online games will be subject to a 12% tax on their gross gaming revenue.

Restrictions

• Individuals under the age of 18 are prohibited from participating in betting activities.
• Betting is prohibited for owners, administrators, directors, managers, and employees of the betting operator.
• Public officials responsible for regulating, controlling, and overseeing betting activities are not permitted to participate.
• Anyone with access to computerised lottery systems are restricted from betting to prevent conflicts of interest.
• Those who have the potential to influence sports outcomes, such as managers, coaches, referees, athletes, and others, are restricted from betting activities.
• Individuals with a gambling addiction are prohibited from betting.

Advertising and addiction

• All communications must adhere to the rules set out by the Ministry of Finance.
• Advertisements must incorporate cautions regarding the negative impacts of gambling and details regarding the prohibition of betting by individuals under 18, including an age rating warning.
• Advertisements must not be directed at children and adolescents
• Advertising content should not:

1. Endorse unauthorised brands.
2. Make false claims about earnings.
3. Portray betting as socially desirable or indicative of personal success.
4. Imply betting as an alternative source of income or financial solution.
5. Offend cultural beliefs or traditions.
6. Promote betting in schools or to minors.

• Internet providers are responsible for removing irregular advertising
• Betting operators are prohibited from obtaining rights to broadcast sports events.

In addition to the stipulations outlined in Law No. 14.790/2023 concerning advertising, the National Council for Advertising Self-Regulation (CONAR) has released Annex 'X' to the Brazilian Code of Advertising Self-Regulation, which outlines the regulations for betting advertisements. These are outlined below:

• Advertising content should be targeted at adults and not children or adolescents.
• Advertisements from influencers, affiliates, ambassadors, and partners must be easily distinguishable from editorial content and clearly indicate their commercial nature.
• Advertisements on social networks should only be posted on pages, blogs, channels, profiles, or with influencers targeting adults.
• Social media profiles and betting advert pages must feature an official verification icon indicating service ownership.
• Advertising must obtain authorisation from the Ministry of Finance before broadcasting on any media platform.
• All forms of advertising must display a warning message such as 'Gamble responsibly' or 'Betting involves financial risks'.

Main restrictions

• No promise of guaranteed, effortless, or excessively high profits or outcomes.
• Refraining from insinuating a false sense of control may lead consumers to believe that repeated product use will enhance the likelihood of winning prizes.
• Avoidance of inducing the idea that participation can lead to wealth accumulation or serve as a form of investment or income.
• Betting advertisements must not target children or adolescents; they must refrain from utilising channels, programs, or content directed at individuals under 18.
• Reproducing advertising in commercial materials specifically intended for children and adolescents, such as clothing, equipment, or products, is prohibited.
• No suggestion or offer of credit or loans to consumers, which would advance funds to the bettor that must be repaid to the operator or third parties, potentially leading to indebtedness.
• Only companies licensed by the Ministry of Finance are authorised to advertise bets.

What happens next?

The next step in regulating sports betting and online gaming involves issuing ordinances to explain the procedures and requirements for market players. We expect three ordinances to be released in the coming months. They include:

1. Ordinance on Systemic Integration
2. Ordinance on Advertising
3. Ordinance on Operator Licensing

As regulatory frameworks evolve and new ordinances are introduced, Brazil's betting industry dynamics are poised to change substantially, shaping how businesses operate and interact within this sector. Global gambling trends and experiences from other countries with more inclusive regulations may also shape Brazil's future policy decisions.

If you plan to expand into the Brazilian market, Rightlander can ensure your brand is represented fairly and remains compliant with Brazil's new policies. Reach out to [email protected] for more information.