Recently, Brazil has become one of the most promising markets for the gambling industry. While the government ponders potential payment restrictions, there are other challenges regarding new regulations that need to be tackled.
In the first installment of a two-part series, CasinoBeats conversed with Alvaro Camargo, Country Manager Brazil at Xtremepush, Thiago Calmon, Online Sales Manager at R. Franco Digital, Tatiana García Barrenechea, Commercial Director for LatAm at Light & Wonder, Thomas Smallwood, Chief Commercial Officer at ESA Gaming, Izabela Słodkowska-Popiel, Head of Account Management for North America and Latin America at Wazdan, and Helena do Couto, Regional Legal Officer LatAm at Eeze, about the current status within the country and the importance of Brazil’s success for the continent as a whole.
CasinoBeats: How optimistic are you about the current state of play in the regulated gambling industry in Brazil?
Alvaro Camargo: We are very optimistic because regulators seem to understand the significance of what’s at stake. Numerous companies were apprehensive about whether the regulations would be attractive, yet we’ve witnessed a notable movement concerning applications for Brazilian licenses.
Many foreign suppliers and operators are eager to enter the market, contributing substantial investments and bringing top-tier industry expertise. This elevates the quality within the market in terms of services, professional teams, and ultimately customer experience.
Thiago Calmon: I am optimistic about Brazil’s market prospects. The potential for growth is substantial, fueled by increasing interest from both local and international operators. With the regulatory framework set to launch early next year, a foundational structure is beginning to take shape, marking positive progress towards market maturation.
However, it is crucial to tackle certain challenges to enable the market’s complete development. Navigating these hurdles strategically will unlock the full benefits of this emerging market.
Tatiana García: Brazil embracing regulation is highly significant not just in LatAm, but globally in the online gaming arena. The number of license applications submitted before the market’s official launch next year indicates a strong enthusiasm to engage in this promising opportunity.
Early involvement from a diverse range of industry stakeholders, including Light & Wonder, is expected as we supply the market with content and services that create a captivating and secure gaming environment.
Thomas Smallwood: I remain cautiously optimistic about Brazil’s regulated gambling market. It’s an enticing yet intricate space with ample potential. We’ve observed significant growth over the past years, although this has decelerated as regulation approaches. Generally, it suggests a maturing market.
If the regulatory process unfolds smoothly and taxation doesn’t hinder the industry, growth may continue steadily, attracting international operators and developers to this lucrative market.
However, challenges persist, like the multiple taxation layers and ambiguity concerning cost-sharing between operators and suppliers. Furthermore, regulations should be effective by January 1, though delays could occur.
Izabela Słodkowska: The outlook for Brazil’s regulated gambling industry is exceedingly optimistic. The recent introduction of regulations for online betting and casino games is projected to spur significant growth, potentially reaching a $3 billion market by 2027.
Though the regulatory landscape presents operational challenges, Brazil’s framework aligns with the growing trend of responsible gambling in Latin America, offering a promising opportunity for operators willing to invest.
Helena do Couto: I consider myself a realistic optimist. Regulation has been needed for years, and now we have it in a comprehensive manner. However, it’s new, as is the administrative authority responsible for it.
Despite being staffed with competent individuals, it’s still in its first year. There are conflicts between state and federal jurisdictions as operators and associated entities adapt to the rules and conduct tests.
We have the theory—legislation and ordinances—set. Now, we’re generating practical experience, adapting operations that previously followed other regulations, such as those from Curaçao. Currently, it’s an intensive learning period, but this tumultuous adaptation phase is likely to be brief.
CB: How vital is it for the continued evolution of regulation in Latin American markets for Brazil to emerge as a success?
TC: Brazil’s success is paramount within Latin America’s regulatory context. As the largest market in the region, Brazil could set a benchmark for other nations to emulate. If Brazil develops an effective regulatory framework, it could lay the groundwork for similar strategies throughout Latin America.
This would stimulate growth, attract investment, and foster a more cohesive and unified regional market. Thus, Brazil’s regulatory journey is crucial for establishing a stable, favorable business environment that benefits the entire region.
TG: Brazil is undoubtedly crucial, and its impact post-launch will ripple across other countries considering regulation. The balance between a bustling, competitive market and crucial player protections could serve as a model for others.
Nevertheless, what operators offer to thrive doesn’t always translate across the region. Brazil lacks current legal land-based casinos, different from other LatAm markets in player and content context.
Argentina, despite economic challenges, has thrived in several regulated regions due to its land-based casino history. Similarly, in Mexico, this heritage has helped our recognizable omnichannel franchises perform well.
TS: Brazil is poised to become Latin America’s gambling hub, presenting opportunities for both domestic and international entities. With the largest regional economy, a 200-million-plus population, and a strong sports culture, Brazil could set a robust precedent for other regional markets.
Success depends on a model balancing operator and supplier profitability with solid player protections, making regulated markets attractive throughout LatAm. If tax burdens—on player winnings and gaming companies—are managed well, Brazil could become a case study for sustainable growth.
IS: Brazil’s establishment of a regulated gambling market is crucial for Latin America’s regulatory progress. It sets a vital precedent for market stability, revenue generation, and responsible gaming practices across the region.
As a major potential market, an effective regulatory framework in Brazil could encourage neighboring countries to adopt similar measures, enhancing Latin America’s appeal to global operators and investors.
HdC: Brazil’s central role in Latin America extends beyond the igaming industry. With its extensive borders and being LatAm’s largest economy, Brazil serves as a key investment driver, innovation center, and strategic hub for market expansion and regulatory developments in emerging sectors.
Brazil’s ongoing success will motivate countries on the continent yet to regulate the sector and appeal to both local and international investors, highlighting the region’s potential for investment and growth.
AC: While LatAm already has some regulated markets, Brazil’s significance cannot be overstated. As such a large market undergoes regulatory model creation and implementation, it showcases what’s possible for neighboring countries.
With robust policies and built-in protections for suppliers, operators, service providers, and customers, Brazil presents a positive outcome that can be replicated elsewhere.
“`