The impacts of banning bonuses on the sports betting and online gaming market in Brazil – Games Magazine Brasil – GAMES MAGAZINE BRASIL

Recently, a new regulation came into force in the sports betting and online gaming scenario in Brazil, bringing with it important changes for financial transaction companies, operators and bettors. This is Normative Ordinance SPA/MF No. 615 (Means of Payment Ordinance), published by the Ministry of Finance and the Secretariat of Prizes and Betting (SPA) last April 16th, which establishes general rules to be observed in cash transactions. payment made by agents authorized to operate the fixed-odds lottery modality in national territory.

The Payment Methods Ordinance emerged as a legislative response to the growing demands in the sector, governing financial transactions in the Betting market. However, one of the most notable provisions is found in article 3, which addresses the prohibition of advances, advances, bonuses, or prior advantages to bettors (Bonus).

The prohibition of Bonuses, as established in paragraph four of the aforementioned article, prevents operating agents from granting, in any form, Bonuses to bettors, even if as a promotion, publicity or advertisement, with the aim of encouraging the placing of Bets within of their platforms.

Bonuses have been a common strategy not only in Brazil, but in other countries. By offering additional financial advantages to bettors, betting companies are able to attract and retain customers on their platforms, thus increasing their bettor base. However, by prohibiting these practices, the question arises about the impacts of this prohibition on the businesses of betting operating companies.

Firstly, it is important to understand that the Bonus is a practice that refers to offering financial incentives or benefits to bettors before they even place their bets, for example, offering extra money to bet or offering free bets.

For the bettor, initially, the bonus can bring an additional financial advantage, as it can give a feeling of increased potential gains or even mitigate losses when betting. However, it is seen that Law No. 14,790, of December 29, 2023 (Betting Law), came with the prospect of implementing responsible gaming in Brazil and, through this, preventing gaming addiction (ludopathy). The ban on bonuses could be a means of realizing the perspective brought by the Betting Law.

Therefore, despite the potential benefits for bettors, such as the promotion of more responsible gambling, the ban on Bonuses brings challenges for betting operating companies. These companies may face difficulties in attracting new bettors and maintaining the loyalty of existing ones, as Bonuses are often an important attraction for bettors.

Furthermore, the ban on Bonuses may bring uncertainty to companies that will be regulated in Brazil, since those that will not be regulated will continue to carry out these actions on the black market, and because of this, it is necessary for the State to monitor, to avoid reducing the revenue of regulated companies due to possible unfair competition in the Betting market.

From the future perspective on the prohibition of these practices for Betting companies, in a market where there is regulation and inspection by the State, these companies will have to find and/or concentrate other strategies, whether marketing or otherwise, to attract and retain customers on their platforms.

In summary, the ban on Bonuses established by the Payment Methods Ordinance represents a significant change in the Betting market in Brazil, and although it may bring challenges for Betting companies, it also offers opportunities to promote a more responsible gaming environment for bettors.

Guilherme Sadi Lawyer, partner at Sadi / Morishita Advogados

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The impacts of banning bonuses on the sports betting and online gaming market in Brazil - Games Magazine Brasil - GAMES MAGAZINE BRASIL