Brazil’s Betting Ban Faces New Uncertainty Following Lula’s Re-Election

Brazil’s online betting market faces continued regulatory uncertainty after President Luiz Inácio Lula da Silva secured re-election, keeping in power an administration that has backed a prohibition on fixed-odds betting. The future of the ban will now depend not only on the government’s position, but also on proceedings before the country’s Supreme Federal Court and the legislative process in Congress.Lula’s victory leaves the betting industry facing a difficult political environment. The president has repeatedly linked gambling to household debt and financial hardship, arguing that the prohibition is intended to protect consumers. His administration’s position is therefore expected to remain a central factor in the debate over the market’s future.

The ban was introduced through Provisional Measure No. 1,394/2026, signed on 25 September. It prohibits the operation, offering and advertising of fixed-odds betting, covering both sports betting and online casino games. The measure took effect immediately, while requiring further action from Congress to remain in force beyond its constitutional consideration period.

The measure reverses a regulatory framework established only recently. Brazil began regulating the fixed-odds betting sector in 2023, with federal authorisations required for nationwide operations from January 2025. Operators had invested in licensing and market entry under that framework, and the abrupt change has prompted legal challenges and calls for legislative amendments.

The industry’s immediate efforts to challenge the ban are focused on two fronts: Brazil’s Supreme Federal Court (STF) and the National Congress. The STF is considering legal actions brought by industry associations and football clubs seeking to suspend the measure. Justice Luiz Fux is the rapporteur for the cases, although no final ruling date has been set.

Congress must also consider the provisional measure. A joint committee of deputies and senators is expected to examine the text before it proceeds to votes in both chambers. The measure has received 99 parliamentary amendments, including proposals that would preserve sports betting while maintaining restrictions on online casino games, as well as provisions addressing sponsorships and the cessation of operations.

The legislative process remains uncertain. The joint committee had not yet been installed by 25 October, and the first deadline for consideration is 23 November. If Congress does not approve the measure within the applicable constitutional period, it will expire. Any extension or amendment would depend on the procedures and decisions of the legislature.

The political balance in Congress may also influence the outcome. Flávio Bolsonaro’s Liberal Party (PL) secured 121 seats in the Chamber of Deputies and 28 seats in the Senate for the next legislature, giving it the largest party caucus in both chambers. However, the party would still need support from other lawmakers to secure legislative changes.

Industry representatives have warned that a prohibition on licensed betting may redirect consumer activity towards unlicensed operators. They argue that demand for gambling may persist even if regulated platforms are removed, potentially shifting consumers away from the protections and oversight of the authorised market. Brazil’s Ministry of Justice has referred more than 16,600 illegal betting websites for blocking since the measure was published, according to figures reported by the industry press.

The ban has also raised concerns about investment and employment. Industry associations have argued that operators made substantial commitments under the previous regulatory framework and that the sudden suspension creates uncertainty for businesses, employees and commercial partners. An association survey cited in industry reporting indicated that more than 3,500 jobs had been lost by 7 October.

The election result does not, by itself, settle the legal status of the prohibition. Although Lula’s re-election is likely to reinforce the government’s position, the measure remains subject to judicial review and congressional scrutiny. The coming weeks are expected to be decisive in determining whether the ban remains in place, is amended or is suspended.

For operators, suppliers and investors, Brazil’s betting market remains in a period of significant regulatory uncertainty. The next key developments will be the STF’s consideration of the challenges and Congress’s examination of Provisional Measure No. 1,394/2026. Until those proceedings produce a definitive outcome, the future of the country’s recently regulated online betting sector remains unresolved.

By fLEXI tEAM