Brazil Issues Online Betting Licenses Ahead of Market Launch
Brazil’s gambling regulator, the Secretariat of Prizes and Bets (SPA), has issued 71 federal online betting licenses in anticipation of the country’s regulated market launch next month.
During a meeting on Tuesday, December 10th, Regis Dudena, head of Brazil’s SPA, confirmed the approval of these licenses. The SPA is still evaluating the remaining 114 applications submitted by the initial deadline of August 20th.
Dudena did not disclose the identities of the approved applicants. However, he stated that all operators in this group have been contacted for a final assessment before the market launch. Brazil is scheduled to open its regulated market on January 1st, 2025, with prior compliance required for operator entry.
“The final requirements here, in addition to some technical requirements such as the certification of your betting system, are mainly related to financial matters, such as total capital, creation of a reserve account, and payment of a concession fee,” Dudena said.
“So, 71 companies have already been notified by the Ministry of Finance. They have 30 days from the date of notification to meet these final requirements.”
Dudena revealed that 16 approved candidates from the first batch have already paid their concession fees. To date, the Ministry of Finance has received a total of R$ 480 million (approximately $80 million USD) in fees. Each licensee is required to pay a concession fee of R$ 30 million.
Who Can Obtain a License in Brazil?
The initial 90-day priority window for licenses opened in May and attracted significant interest from operators. The process exceeded the initial deadline, and by early November, over 270 companies had submitted a license application.
Those who applied after the deadline will almost certainly not have their license in place by the opening day. The regulator has previously stated that it would prioritize those from the first application period to ensure they are operational by January 1st.
Operators who have applied for a license include Sportingbet, Big Brazil from Caesars Sportsbook, Superbet, and Rei do Pitaco. Betano, owned by Kaizen Gaming, became the first to apply on May 26th, just days after the window opened.
Analysts believe that Flutter Entertainment will assume an early lead in Brazil. Macquarie stated that the group could increase its online market share in Brazil by 150% in five years, from 10% to 25%.
Rob Coldrake, CFO of Flutter, discussed the group’s chances in Brazil during the Q3 results. He said: “We are excited to participate in a market that we consider exciting and full of opportunity.”
Early Withdrawals from the Licensing Race
However, last month, it was revealed that several operators withdrew from the process before their application was processed. Super Group’s Betway is among the most prominent names on the list of withdrawals.
Speaking about the decision, Super Group’s President and Chief Commercial Officer, Richard Hasson, said that the operator would focus on markets in which it sees a way to generate returns after its launch.
“Obviously, there has been a lot of talk about Brazil throughout the industry at the moment,” Hasson said. “That is a market that we will not pursue at this time, compared to all the markets we have looked at.” “We want to ensure that we can identify the same path to profitability when we go live.”
Arena Esportiva, AmuletoBet, and Vera&John, currently owned by Bally’s Corporation, have also abandoned the race.
New Vote for Land-Based Casinos
Regarding delays, the Brazilian Senate has again postponed a planned vote on a bill to legalize land-based casinos, bingo halls, and horse racing betting in the country.
Bill 2.234/2022 was approved in June by the Constitution, Justice and Citizenship Commission (CCJC) of the Chamber of Deputies. However, the bill has suffered several setbacks.
The August voting date was not met, and hopes for an October vote were also dashed. Irajá Silvestre, the senator behind the bill, said last month that he expects a vote to take place before the end of 2024.
Another vote was scheduled for December 4th but did not occur. Senators debated the proposal, but Silvestre withdrew the bill. Senate President Rodrigo Pacheco said the bill will be voted on next year.
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