The Senate of Brazil has approved the ‘basic text’ of Bill 3626/2023, providing the foundations for the launch of a federal sports betting market.
Yet, following further amendments, the Senate has ordered that the Bill be returned to the Chamber of Deputies for further analysis.
The decision follows three critical considerations debated by the Senate yesterday afternoon ahead of its symbolic vote.
The Senate considered ‘amendments and limitations’, in which it upheld an appeal by Liberal Party Senator Carlos Portinho (RJ) to exclude online casino modalities from the Bill’s text
As referenced by the Senate’s plenary notes, Portinho defended the Liberal Party’s stance against the online casino being upheld in the text of the Bill, which holds the primary objective to regulate fixed-odds betting.
“Portinho highlighted that the emphasis restores the position of the original provisional measure, which excluded casino games – which, according to him, could be dealt with in another project. He objected to the inclusion of virtual games in the text, noting that the profit margins are smaller in real games.”
In further last-minute deliberations, the Senate rejected an amendment that sought to ban betting advertising for sports teams and arenas. Furthermore, the plenary sessions dismissed an appeal by PP Senator Tereza Cristina to exclude physical betting machines from the bill.
All fiscal and tax modalities proposed by the Senate’s Economic Affairs Commission (CAE) were maintained as Brazil’s federal market will apply a 12% tax on licensed operators and a 15% tax on player prizes. On the income collected, 2% will go to social security as “other recipients of the resources will be the areas of sport (6.63%) and tourism (5%).”
Licensing duties will require operators to pay BRL 30m (€5.5m) to acquire a federal license. This license will be valid for five years and will allow operators to service three brands. All businesses (foreign and domestic) are required to have a domiciled presence in Brazil, with a legal guardian.
The governance of Brazil’s federal sports betting market will be overseen by the Ministry of Finance, which will establish dedicated supervision for standards, conduct and consumer protections. Prior to yesterday’s vote, the Ministry had informed that 134 businesses had filed their pre-market ordinance measures, expressing interest to join Brazil’s pending online gambling marketplace.
The Senate has maintained stringent penalties for infractions, allowing for fines up to 20% of a company’s proceeds, with a cap of BRL 2 billion (€350 million) per violation. Sanctions may also entail the immediate suspension or cancellation of a company’s licensing permissions.
Bill 3626/2023 will now be returned to the Chamber of Deputies for further examination on the final text endorsed by the Senate.
A review of online casino modalities must be undertaken by Deputies, considering the exclusion’s impact on the government’s plans to raise income for the legislation.
Deputies face the choice of extending the Bill’s remit to cover online casino games as recommended by former rapporteur Angelo Coronel, or to maintain the text as it stands for its federal sign-off by President Lula da Silva.
As noted in the debate, Senator Jorge Kajuru (SP), who opposed the exclusion of online casino games, remarked, “That’s what’s going to happen. We, senators, wear the shirt of idiots for the country”.
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