In December, Law 14.790/2023 was published, which addresses the lottery modality known as “fixed quota betting.” This modality operates as a mechanism through which a certain amount is risked in the expectation of winning a prize, subject to a multiplication factor of the wagered amount that defines the sum to be received by the bettor.

Fixed quota betting will be authorized by the Ministry of Finance (MF) through a discretionary act and will not be subject to a minimum or maximum number of operators. Additionally, it will have a highly personal and non-transferable character, and may be granted for a period of up to five years. Only Brazilian companies, with headquarters in the national territory, will be eligible for such authorization.

The establishment of those companies will depend on regulations from the MF, which will specify:

1. the minimum amount and method of capital integration;
2. requirement of proven knowledge and experience in games, betting, or lotteries;
3. requirements for the management of the companies;
4. appointment of a director in charge of relations with the MF;
5. structure for a customer service center and the operator’s ombudsperson;
6. appointment of a director responsible for customer service and the ombudsperson;
7. technical and cybersecurity requirements;
8. integration or association of the operating agent with national or international bodies for monitoring sports integrity; and
9. requirement to have a Brazilian partner holding at least 20% of the share capital.

Authorization for betting operations is contingent on the demonstration of internal protocols and safeguards, including customer service, anti-money laundering measures, responsible gambling, and the integrity of betting. The partner or controlling shareholder of the operating agent must not have a stake in a Football Corporation (Sociedade Anônima do Futebol) or act as a Brazilian sports director.

The authorization request must be made electronically along the MF, following the chronological order of the protocol. The granting of authorization for fixed quota betting requires the payment of a consideration limited to R$30 million for three brands. The authorizations cover both virtual and/or physical modalities, with online games requiring that bets take place exclusively in a virtual environment. Both electronic channels and physical establishments must display information such as corporate name, CNPJ (National Registry of Legal Entities), number and date of authorization, address of the headquarters, and contact information.

Advertising and Marketing

The MF will regulate the communication, advertising, and marketing activities of fixed quota betting lotteries. This regulation will include warnings discouraging gambling; informative actions for awareness and prevention of pathological gambling among bettors; targeting advertising exclusively to an adult audience. It is prohibited for the operating agent and its subsidiaries to acquire, license, or finance sports events in Brazil for the transmission, reproduction, distribution, or exhibition of sound and images.

Payment transactions

• Financial institutions authorized by the Central Bank of Brazil (Bacen) will offer accounts for bettors’ transactions, allowing deposits, withdrawals, and receipt of prizes.
• Bettors’ funds must be kept separate from the assets of the betting operator and are not liable for the obligations assumed by the latter.
• Betting operators must adopt identification procedures, including facial recognition and identity confirmation through communication means upon user registration.
• The MF will regulate the obligation of operators to develop monitoring systems to identify gambling-related harm and establish user time limit controls.
• The betting operator must maintain records of all operations, such as bets, prizes, withdrawals, and deposits in transactional accounts.

Bettor Rights

In addition to the rights set forth in the consumer protection code, the bettor is entitled to accurate and clear information as well as guidance on:

• betting rules;
• conditions for correct forecasting and prize determination;
• risks of losing the wagered amounts;
• personal data protection.

Furthermore, the betting operator must provide customer service to bettors, in order to resolve queries and requests related to the operation of the fixed quota betting lottery.