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Brazil’s Secretariat of Prizes and Bets has published an ordinance governing payments for online betting, a move that suggests it is sticking to a new timeline to introduce a regulated market.
The secretariat released a regulatory schedule earlier this month detailing when specific ordinances would be published, but given Brazil’s track record with hitting deadlines for gambling regulation, industry observers would be forgiven for anticipating further delays.
However, the payments ordinance published on Thursday (April 18) is an indication that the newly-formed Prizes and Bets Secretariat, despite the Brazilian government still not having officially appointed a secretary to lead the agency, is very much in motion.
It has been widely reported that Regis Dudena, a seasoned government lawyer, will be stepping up to the plate. Dudena could even be formally nominated to the role of Brazil’s chief gambling regulatory official as soon as early next week.
Thursday's ordinance expressly bans payments for online betting and gaming made via “virtual assets or other types of crypto-assets”, as well as through “credit cards or any other postpaid payment instruments”, while authorising deposits made with instant payment system Pix and debit cards.
Pix is a popular electronic payment method launched in 2020. Similar to Venmo in the US and Monzo transfers in the UK, but offered ubiquitously and on a centralised basis, Pix is an instant payment system (SPI) established with the Central Bank of Brazil.
Among other things, the ordinance also obliges future licensees in Brazil to provide a minimum R$5m (US$1m) reserve to cover prizes. Prizes and withdrawals must be paid out within two hours of a request by the player.
The new regulation also repeats language included in December’s Law 14.790 to expressly prohibit operators offering “an advance, bonus or prior advantage” to players, although the overall issue of whether bonuses will be banned in their entirety in Brazil’s regulated market is not necessarily resolved.
Lawyers interviewed by Vixio GamblingCompliance have stressed that the legislative intent is not to prohibit all bonus offers, and industry groups are understood to be advocating for free bets and other retention bonuses to be allowed under the guise of loyalty programmes offered to players.
Other regulatory ordinances that are due to be released in April will address the technical and security requirements for betting systems and establishing rules for licensing. The latter of those is also expected to trigger the start of a licensing process for operators.
Thursday’s ordinance clarifies Article 21 of December’s law by confirming that a prohibition on the processing of financial transactions for unlicensed operators will not become effective until six months after licences become available.
In May, further ordinances governing anti-money laundering controls and player rights and operator responsibilities are scheduled. Technical standards for online gaming are among further ordinances planned for June and July.
