Regulation of games and betting: sunlight is the best disinfectant.

On August 20th, the first deadline for requesting authorizations for betting operators, known as "Bets," ended. Companies that registered by that date will have their applications evaluated until December 31, 2024, and, if approved, may begin operations in January of next year. Companies that register later will have their applications analyzed within 150 days of submitting the documents. With a fixed fee of 30 million reais per authorization, revenue from authorizations could exceed 3 billion reais in 2024 alone.

In this initial period, 113 authorization requests were received, a significant number that reflects the potential of the Brazilian market and the commitment and seriousness of the regulator.

After more than 4 years of inaction since the publication of Law No. 13.756/2018, which established fixed-odds betting, the Secretariat of Prizes and Betting (“SPA”) was created in January 2024 to regulate, standardize, monitor, supervise, inspect, and sanction the sector. The SPA established and rigorously complied with the regulatory policy and agenda, publishing more than 10 ordinances up to July 31, 2024.

The strong interest from companies in the sector reflects the immense potential of the Brazilian market. According to the Statista platform, global betting market revenue is expected to reach $97.7 billion in 2024, while Brazil could generate almost $25 billion by 2029. This creates enormous potential for tax revenue and job creation.

Confirmation of these expectations will largely depend on confidence in the market, which still faces significant stigma. Issues such as responsible gaming, fraud prevention, and anti-money laundering are crucial to the segment's success.

The initial step has already been taken with the structuring of the regulatory framework and the beginning of authorization requests. Regulation and supervision of operators will provide greater transparency and effectiveness in distinguishing between correct and irregular practices. After all, as the American jurist Louis Brandeis said, "sunlight is the best disinfectant."

(*) Mariana Tumbiolo is a Partner at the Madruga BTW law firm, holds a Master's degree in Criminal Law from USP and a Master's degree from Northwestern University. (Photo: Personal archive) The article was published on Fausto Macedo's Blog in Estadão.