Brazil’s Comprehensive Overhaul of Land-Based Laws and Regulations

On Wednesday, Brazil’s Senate’s Constitution and Justice Committee (CCJ) voted in favour of Bill No. 2,234/2022, a federal project that seeks to modernize Brazil’s land-based gambling laws. The bill secured 14 votes in favour and 12 against, paving the way for it to progress to the State Plenary for further revisions and discussions.

One of the key provisions of the bill is the reversal of the 1946 Decree Law that had previously banned the operation of land-based casinos in municipalities and districts. The new legislation aims to allow the establishment of casinos in tourist locations or integrated leisure complexes, with a limit of one casino per state and in the Federal District. Larger states, such as Rio de Janeiro, Minas Gerais, Paraná, Amazonas, and São Paulo, will be granted additional casino licenses, with the latter being allowed up to three properties.

The project also liberalizes the rules governing bingo venues, allowing them to operate in designated locations. Under the new framework, each municipality will be permitted to host one bingo establishment, with the possibility of additional venues based on the population size of the town or district. Bingo licenses will be sanctioned by local municipalities, with a validity period of 25 years and a renewable option. Operators will be required to maintain a minimum capital of R$ 10 million to obtain a license.

The bill also addresses the longstanding issue of the “jogo do bicho” instant win games, which have been a part of Brazil’s gambling landscape for decades. The project proposes that each state and the Federal District may accredit one legal entity per 700,000 inhabitants to operate these activities. The new regulations will allow for states and federal districts to independently manage “jogo do bicho” vendors, who must meet specific legal requirements, including a minimum fully paid-up capital of R$ 10 million to obtain a license.

The project also calls for an overhaul of Brazil’s laws related to horse racing, with the goal of modernizing the country’s turf venues. This mandate will be overseen by the Ministry of Agriculture, ensuring a comprehensive approach to the regulation and development of the horse racing industry.

The bill includes several protective measures to ensure responsible gambling practices. It stipulates that only individuals with full civil capacity can place bets, excluding those who are insolvent, over-indebted, or involved in debt restructuring in the past two years. Public agents, administrators, and members of gaming house controlling groups are also barred from participating in gambling activities.

To further promote responsible gambling, the project calls for the establishment of a National Register of Prohibited Persons (Renapro) to monitor and restrict access for those deemed unfit to gamble. Gaming houses will be required to verify entrants against this register before allowing them to participate.

The new gambling framework will introduce a 20% withholding tax on prizes over R$ 10,000. Additionally, businesses will be subject to a Gaming and Betting Inspection Fee (Tafija) and the Contribution of Intervention in the Economic Domain (Cide-Jogos). The generated tax revenue will be allocated by states and municipalities to support various social initiatives, including tourism, sports, and cultural programs.