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FEATURE
into the bill , to the extent that most of the revenues for operators come from igaming rather than from fixed-odds sports betting ,” he says . “ The federal government wanted to collect as much tax as possible .”
Baungartner very much agrees that the financial allure of including igaming has served to outweigh the largely evangelical opposition .
“ The government knew that igaming was crucial for their 2024 budget . I could say that was a master play from them ,” he says .
“ They [ the opponents to igaming ’ s inclusion ] always existed and will exist . However , they have to understand that the gambling business is a reality in Brazil . They were , are , and will be , against gambling forever . Every time that an attempt was made , they made a big noise , including an association to work against its regulation .”
DEFINING THE IGAMING LANDSCAPE
Now that igaming is being included , the next big question – which is a particularly important one given that it will be the regulated market ’ s biggest revenue-generator – is what games will be available ?
As of now , the definition stands at “ virtual online gaming events ”, which can be subject to fixed-odds betting , along with real-life events .
At this point , it seems that the actual definition , and indeed what might be permissible , remains very unclear . Going into more detail , the law defines online gaming as “ the electronic medium that enables a digital bet on a game whose result is determined by the outcome of a future random event through a random generator of numbers , symbols , figures or objects , as defined through regulations ”.
Arguably , that could cover slots – and
“ As a Brazilian gaming lawyer for nearly two decades , this is the moment I have been waiting for all this time and was betting my chips on ”
Neil Montgomery , Montgomery & Associados
indeed , “ virtuals ” such as those made by Kiron , Inspired or Golden Race . This also leaves a big gap as to what it means for live casino , as games such as blackjack are defined by the dealer , rather than random number generation .
Although , given live casino ’ s popularity in neighbouring markets , particularly in Colombia ( where Coljuegos estimates it accounts for 8 % of the market in September 2023 ’ s figures ), we can assume that it will be incorporated . After all , igaming is the principal money maker here when it comes to taxing operators on GGR – logically , it should be a case of the more , the merrier .
More likely perhaps , is this issue instead being the ministry of finance failing to properly define what it plans to include within its framework . Following multiple delays for the final vote to be made before the end of December ( which was necessary for the bill to be included in the 2024 budget ), it is possible that full clarity of the framework was not achieved and , for lack of a better word , we saw it hurried over the finish line .
TRANSITIONING FROM OFFSHORE
The next big question now is how the offshore industry is transitioned into the regulated framework . As estimated by H2 Gambling Capital , Brazil ’ s offshore gambling market is estimated to be worth $ 2.6bn . Currently , the new law requires the ministry of finance to establish conditions with a deadline of six months for companies to enter the regulated market .
Similar to the transitionary period for the Netherlands , it is not clear whether a transition period might extend beyond the minimum term of six months . Or indeed , what compliance conditions might apply to Brazil-facing operators who are intending to become licensed after previously serving customers from an offshore base .
Along with this , a wider question remains as to how this transitionary
78 • ISSUE 135 • ICE LONDON 2024