Brazilian Gambling Sector Faces Advertising Restrictions
Legal experts are concerned that the fragmented representation of the gambling sector within trade associations is hindering their fight against pending restrictions on betting advertisements.
Following Senate approval of Bill 2.985/2023 in May, a new wave of restrictions on gambling advertisements is expected in Brazil. This will likely add to the challenges operators have faced since the launch of Brazil’s regulated online betting market on January 1st.
While Senator Carlos Portinho, the bill’s rapporteur, removed a blanket ban on betting advertisements from the proposal, the approved bill includes a prohibition on betting advertisements during live sports broadcasts. The use of celebrities, influencers, and athletes in marketing materials will also be prohibited, with the ban applying only to current players or those whose careers ended less than five years ago.
Having been approved by the Sports Committee and the Senate, the amended bill now goes to the Chamber of Deputies for consideration.
Udo Seckelmann, head of gambling and crypto at Bichara e Motta Advogados, believes the new law is unlikely to take effect until 2026. He is relieved that the “disproportionate” general ban was eliminated but warns that the push for new restrictions “lacks evidence-based support.”
“The motivations, while well-intentioned, must be weighed against real-world outcomes – and evidence suggests that informed, responsible regulation is more effective than prohibition,” explains Udo.
Is Current Regulation Sufficient?
The Secretariat of Prizes and Bets (SPA) published Ordinance 1.231 last July, outlining how licensed operators could advertise their products. The regulations included restrictions on operators presenting betting as “socially attractive” or using advertisements to target children or adolescents.
Additionally, all advertising by licensed operators was required to display an “18+” symbol and be guided by social responsibility and the promotion of responsible gambling.
Luiz Felipe Maia, founding partner of Maia Yoshiyasu Advogados, believes the current advertising restrictions are adequate, especially given Brazil’s recent regulation of its iGaming sector.
“I think the current regulation is enough to protect people, and they are coherent with this stage of the market, because Brazil has just become regulated,” says Felipe Maia. “When you have a new regulated market, it’s important to allow regulated operators to advertise and become known to the public, so you can direct the public to these regulated operators. I think it’s [important] that we don’t have as many restrictions as in other regulated, but more mature, markets.”
Fellipe Fraga, business director at licensed operator EstrelaBet, agrees that the current regulations are sufficient. “I believe it is enough,” says Fraga. “The most important thing is to have awareness. Politicians and other regulators understand that the market is fine [as it is] and everyone is doing [online betting], so we can also advertise.”
On the other hand, Betsul CEO Fernando Garita wants clearer advertising regulations. He is calling for clarity and consistency from the SPA: “We need a better balance, allowing responsible messaging without stifling legitimate commercial activity.”
Enforcement is a Priority
While the licensed sector is generally satisfied with the current advertising restrictions, many stakeholders are calling for stricter enforcement, especially regarding influencer advertising, which became a hot topic in the industry and national media last year.
The “Fortune Tiger” game was the subject of several controversies last year. Influencers were investigated and, in some cases, arrested after marketing the game to their followers and promoting attractive financial rewards. Many players ended up losing large sums of money playing on fraudulent sites.
Since the scandal, the SPA has taken steps to further restrict influencer advertising. Internet personality Virgínia Fonseca appeared before the CPI das bets in May to answer questions about advertising games to her large online following.
Felipe Maia believes the SPA should crack down on those who violate the existing regulations. “I think if we start having these cases where digital influencers are held accountable, have to pay fines, and maybe be arrested for working with illegal operators or not complying with advertising rules, we will start to see different behaviors,” he insists.
Over-Regulation Risks Strengthening the Black Market
The Brazilian betting sector is not the only market facing pressure on its gambling advertising. Looking at other more mature markets, it is understandable that there are concerns about the consequences of even greater restrictions.
Germany, where almost half of all gamblers bet with the black market, has a ban on TV and online advertising between 9 pm and 6 am, as well as restrictions on showing sports clips in advertisements and partnerships with sports personalities.
Italy, which has a blanket ban on betting advertising, is facing serious problems in the black market, while neighboring Argentina has also taken steps to introduce a ban on online betting advertising.
With licensed operators in Brazil already concerned about the presence of the black market, the industry fears that stricter advertising regulations will only strengthen illegal companies, as seen in other nations.
“The experience of countries like Italy shows that excessive restrictions and high taxes can backfire,” explains Fernando. “Blanket bans would significantly reduce the visibility of regulated operators, while illegal ones would continue to thrive through uncontrolled channels, such as Telegram.”
“If a market becomes regulated with too many restrictions on advertising, you are basically hurting channeling and helping the black market,” adds Felipe Maia.
Advertising Helps Identify Legal Operators
Advertising is an extremely important tool for operators to demonstrate that they have a license and channel bettors to legal offerings, especially in the early stages of a licensed market’s development, when competition between brands is fierce and player loyalty has not yet been established.
With licensed operators required to include the “18+” symbol in their advertising, as well as information about the risks associated with addiction and pathological gambling disorders, Fernando states that advertising’s role in distinguishing between legal and unlicensed operators is “crucial.”
“Advertising is one of the few public-facing tools we have to demonstrate that we operate legally,” he says.
“It allows us to build trust, promote safety, educate users, and show that we work within a regulated framework. Eliminating this visibility blurs the lines between legal and illegal operations, which poses a great risk to consumers.”
Even with advertising clarifying this distinction, markets like Sweden have found that a high percentage of players still cannot distinguish legal operators from black market brands.
What’s Behind the Negative Public Perception?
In 2024, there has been significant pressure on the gambling sector in Brazil, during a crucial period of regulatory construction. A hearing at the Supreme Federal Court was held in November due to accusations of unconstitutionality of the new betting laws made by a major union, amid fears that betting leads to high levels of addiction and family debt.
However, four months after the licensing of betting, public opinion on the matter seems to be improving, and in April a public survey conducted by DataSenado reported that 60% of the population is in favor of legalizing casinos. Part of the sector’s frustration lies in the belief that politicians are responding to public pressure rather than data and global industry experiences that prove why advertising restrictions can have unintended consequences.
Some politicians, particularly the rapporteur of the new bill on advertising restrictions, have adopted negative rhetoric about gambling, insisting that it harms public health and finances.
Political Echo Chamber
Felipe Maia believes that there is no negative public perception of gambling in Brazil and states that politicians are simply repeating the fears of specific groups. “Basically, they are responding to their echo chambers,” he says.
“If they are religious, they are responding to the groups they represent. If they are more conservative, they are saying [these things] because it resonates well with their audience. What you have is an opportunistic approach by some politicians to use this for propaganda purposes.”
The situation is further complicated by Brazil’s long history of gambling prohibition, when the sector was outlawed in 1946. This has resulted in a lack of political understanding.
“We are trying to make them understand and, of course, in Brazil, with 80 years of cultural prohibition of gambling, they still don’t really know what our sector does, what you can offer to the country,” says Felipe Fraga. “For us, it’s a process of teaching, explaining [how our sector works] and avoiding these understandings, because many of these [bills] are based on misunderstandings.”
What is the Solution?
Ultimately, an effective response from the betting sector to Bill 2.985/2023 could be undermined by the sector’s fragmented representation.
According to Felipe Maia, there are five trade associations representing betting companies, causing a lack of coordination and likely weakening the sector’s response to any over-regulation.
“I received this complaint from a parliamentarian. What they say is that it’s very difficult to deal with this industry, because they get different contributions from different associations and then they don’t know who to trust,” states Felipe Maia.
For Fernando, the path lies in collaboration. He agrees that the fragmentation in industry representation complicates building an effective response.
“Lobbying efforts and collective action by responsible operators and associations will be crucial,” adds Fernando. “We need unity and coordination to defend common interests.”
During the Sports Committee hearing to approve Bill 2.985/2023 on May 28th, Senator Portinho said the changes were necessary due to the sector’s inability to police its own advertising activities.
Felipe Maia recommends that operators self-regulate whenever possible to prove they are good actors. “I think self-regulation shows social responsibility, maturity. And it allows you to come up with solutions that work for the industry before someone comes up with an idea that won’t work,” he says.
Critical Moment Approaching
As Udo explains, an assertive but constructive approach to advertising regulations could help mitigate negative political opinion. “It is essential to emphasize that advertising, when done responsibly, plays a key role in channeling users to licensed and safe operators and away from illegal sites,” he reiterates.
As it stands, those seeking to restrict gambling appear to be winning the battle, especially with the sector’s current inability to build a collective, data-driven response that effectively warns against the dangers of excessive advertising regulation seen in other markets.
The sector’s argument is clear: Excessively restrictive measures on advertising at this point in Brazil’s online gambling regulation journey could be disastrous and drive actors out of the licensed sector.
As the Chamber of Deputies prepares to assess Bill 2.985/2023, the Brazilian betting sector must act swiftly to defend itself against perceptions that threaten to undermine the advances of the legal market.
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