Brazil Betting Licence Revocations Threaten Market Future

Brazil’s regulated betting industry is facing an uncertain future following the cancellation of licensed operators’ authorisations under Provisional Measure (MP) No. 1,394/2026. With the measure awaiting a decision from Supreme Federal Court (STF) Justice Luiz Fux, Carlos Lima, president of the Brazilian Institute for Responsible Gaming (IBJR), has warned that the disruption could permanently change the market.

Speaking to Folha de S. Paulo, Lima said licensed operators were still hoping Fux would suspend the measure within the coming days. However, he cautioned that delays in granting an injunction would deepen the economic consequences for companies and their employees.

“The longer it takes to grant the preliminary injunction, the greater the negative effects of the ban become, such as layoffs,” Lima said.

Licence Revocations Threaten Operators and Jobs

The measure has led to the cancellation of licences held by authorised betting companies, creating uncertainty across the regulated sector. Anonymous experts quoted by Folha de S. Paulo also warned that the move had weakened investor confidence, potentially discouraging companies from returning even if the measure is overturned.

The full scale of the impact remains unclear, including how many operators may decide to leave Brazil permanently. Lima said some companies had already carried out extensive workforce reductions, retaining only the minimum staff needed to maintain a legal presence in the country.

“Some companies have drastically reduced their workforce in Brazil. They have laid off practically their entire staff and kept only the basic structure necessary for the company to continue operating legally, at least minimally, in the country. In other words, the legal and compliance departments remain, while areas such as customer service, for example, have been eliminated,” he said.

Smaller operators could be particularly exposed, according to Lima, as they may not have the financial resources available to larger corporate groups.

He said it was still difficult to establish which companies would be unable to restart their operations. However, businesses without the backing of larger groups could struggle to remain in the country.

“I believe the sector will not return to what it was before,” Lima stated.

Regulatory Requirements Still Apply

Despite the cancellation of operating authorisations, affected companies remain subject to other regulatory obligations, according to the Ministry of Finance in comments to Folha de S. Paulo.

The ministry pointed to Ordinance No. 3,005/2026, which sets December 15, 2026, as the compliance deadline. The clarification means that uncertainty over the future of the regulated market does not remove the requirements that operators must continue to meet.

IBJR Questions Consumer Protection Impact

Lima also questioned whether removing authorised betting platforms would achieve the intended consumer protection objectives. He warned that players could instead face greater exposure to unlicensed websites and online fraud if regulated operators disappear from the market.

He argued that a prohibition should not automatically be viewed as a protective measure, particularly when consumers could turn to hidden platforms and become more vulnerable to scams.

The IBJR president stressed that the organisation was not politically aligned and said the regulated sector had been willing to engage with the federal government over the years.

He also pointed to areas where further discussions could help improve the existing framework, including advertising rules and consumer protection measures.

Lima called on the government to take more effective action against platforms that facilitate illegal betting. For the regulated industry, the uncertainty now extends beyond the possible restoration of licences, raising wider concerns about investment, employment and the long-term direction of Brazil’s betting market.