Brazil: Provisional Measure no. 1.182/2023 regulates sports betting

In brief

On 25 July 2023, Provisional Measure No. 1,182/2023 was issued, amending Law No. 13,756/2018, to discipline the operation of the fixed-odds lottery by the Union, that is, mainly to regulate the performance of sports betting sites in Brazil, among other minor points.


More details

The text of the Provisional Measure No. 1,182/2023 has as main points:

  • It allows the operation through national and foreign Legal Entities, provided that they meet the requirements contained in the regulations of the Ministry of Finance.
  • Stipulation of penalties and fines in case of non-compliance with the rules.
  • Definition of concepts of real sports events; bettor; virtual bet; physical bet; fixed quota and operator agent (the betting sites).
  • Income Tax and Social Contributions will be levied on the proceeds of the lottery.
  • The monthly Social Contribution of 18% (composed of Social Security + Education + FNSP + National Sports System + Ministry of Sport) will be levied on the so-called "Gross Gaming Revenue" (= Bet - prize paid). That is, the operating agent (site) will keep 82%.
  • The operating agent (site) will have to withhold Income Tax due by the bettor at he rate of 30% on the prize money that exceeds the value of the first band of the monthly income tax table of the Individual Income Tax - IRPF, currently BRL 2,112.00.
  • The Ministry of Finance will regulate the form and process by which authorizations will be granted to all lottery operators.
  • Creation of an authorization fee, to be updated annually by the Ministry of Finance.
  • Creation of the Inspection Fee.
  • Prohibition of betting operators from acquiring rights to broadcast sporting events and the like.
  • Prohibition of advertising of websites or betting companies not authorized by the Ministry of Finance.
  • Prohibition of a partner or manager of SAF (Sociedade Anônima de Futebol) to be a partner (direct or indirect) of an operating agent.
  • Prohibition of participation of under 18 years old, public regulatory agent, owner or influential and operating agent, person who has influence on the outcome of the event, person registered in national credit protection register, among others.
  • Deadline: the main rules will be valid upon publication of the Regulation by the Ministry of Finance, which will also determine the applicable measures and transition periods.

In addition, the Provisional Measure also deals with:

  • Updating the wording of the Law to adapt to more corporate forms of sports entities, such as SAFs.
  • How public bodies should allocate the amounts received for social contributions.
  • Determinations on marketing rules for betting.
  • Central Bank will discipline payment arrangements, to avoid operation of unauthorized companies.
  • Obligation of the operating agent to report suspicious activities to the Ministry of Finance.

The Provisional Measure will proceed to a vote by the National Congress, within up to 120 days, so the text may undergo changes.

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*Trench Rossi Watanabe and Baker McKenzie have executed a strategic cooperation agreement for consulting on foreign law

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