Legal definition of ‘gambling’

What are the legal elements required for an activity to be regarded as gambling?

As an introductory note, gambling and betting activities are, since the enactment of Decree-Law No. 9,215 in 1946, which enforced article 50 of Decree-Law No. 3,688/1941 (the Law of Misdemeanours), considered criminal contraventions and therefore are prohibited in Brazil. Nonetheless, in recent years, the debate over the legislation regarding this matter has recurred. Currently, bills providing for the legalisation of the commercial exploitation of gambling are in an advanced stage of discussion in the Senate and House of Representatives. Notwithstanding the above, Brazilian law provides two exceptions to this rule; namely the lotteries and horse races carried out at authorised racecourses (see question 7).

The Law of Misdemeanours characterises gambling as:

  • a game where the gains and losses depend exclusively or predominantly on luck;
  • bets on horse races carried out on unauthorised racecourses - note that online horse race betting is also prohibited according to a court decision issued in 2013; and
  • bets over any other sport competition.

Moreover, for gambling to be considered a misdemeanour under Brazilian law, the gambling activity must be established or explored in a public location or accessible to the public, regardless of whether a fee is charged to enter that location. For criminal purposes, the following can also be considered as locations accessible to the public:

  • a private house where gambling takes place in which people other than the family that lives in the house commonly participate;
  • a hotel or collective housing where gambling is offered to its guests and residents;
  • a head office or premises of a company or association in which gambling is carried out; and
  • a business unit intended for the exploitation of gambling, even if such intention is concealed.
Remote activity

With respect to remote or other cross-border activity, where is the wager deemed to take place?

Considering that the Law of Misdemeanours was enacted in the 1940s, there is no specific provision in Brazil setting forth rules or concepts related to remote or other cross-border gambling activities.

In this sense, although the current market practice in Brazil demonstrates that wagers in remote gambling activities are considered to have taken place in the location of the operators’ servers, it remains unclear whether there is criminal liability if servers hosting online gambling sites are based in a country where gambling and betting are permitted.

Age restrictions

What is the minimum age for participating in lawful gambling?

Since gambling is prohibited in Brazil, there is no age limit for gambling to be considered legal.

However, with respect to lotteries and horse race betting, the participant can participate in such activities when he or she reaches 18 years of age.


What are the penalties for offering unlawful gambling?

The Law of Misdemeanours provides different penalties depending on the kind of unlawful activity carried out, such as the following:

  • establishment or exploitation of gambling in a public location or accessible to the public: imprisonment of three months to one year, plus a fine and loss of the furnishings and decorations of the location where the gambling was held;
  • promotion of lottery without legal authorisation, or sale, storage or circulation of unauthorised lottery tickets: imprisonment of six months to two years, plus a fine and loss of the furnishings of the location where the unauthorised lottery was held;
  • sale, storage and circulation of foreign lottery, raffle or tombola tickets: imprisonment of four months to one year, plus a fine;
  • sale, storage and circulation of state lottery tickets in territories where such tickets are not authorised to circulate: imprisonment of two to six months, plus a fine;
  • exhibition or possession foreign lottery lots: imprisonment of one to three months plus a fine;
  • printing or the execution of any service related to the production of tickets, lots, signs or banners related to lotteries in unauthorised locations: imprisonment of one to six months, plus a fine;
  • distribution or transportation of lottery banners, lots or notices in unauthorised locations: imprisonment of one to three months, plus a fine;
  • promotion of lottery announcements, notices or drawings in locations where the respective tickets are not authorised to circulate, by means of newspapers, radio, cinema or any other form of advertisement: a fine; and
  • exploitation or organisation of the ‘animal game’ lottery (Jogo do Bicho) or practising any act related to its exploitation or organisation: imprisonment of four months to one year, plus a fine.

Jogo do Bicho is an illegal and popular gambling game in Brazil consisting of a lottery-type drawing operated on a regional basis by bicheiros. Unlike most state-operated lotteries, any amount of money can be bet in Jogo do Bicho.

Does the law penalise the gambler directly for participating in unlawful gambling?

Yes, the Law of Misdemeanours provides that gamblers are also subject to a fine of 2,000 - 200,000 reais, regardless of whether the gambling was land-based or carried out remotely (eg, through the internet or any other form of communication).

Social and non-profit gambling

Are there exceptions for social gambling, or charitable or non-profit gambling?

Although there are no exceptions expressly provided in Brazilian law for gambling activities other than lotteries and horse race betting, there is a social perception in Brazil that minor gambling is a tolerable activity in some places, hence why games such as Jogo do Bicho or social bingos are so popular. In this sense, it is also common to see private and non-profit agents organising raffles and other similar activities to raise money for a specific reason or cause (eg, churches raising money for refurbishments or a certain social event, or athletes raffling sports gear to raise money to participate in a certain competition).

In addition, although Brazilian case law has consistently prohibited most gambling-related activities, a more flexible approach has been demonstrated towards poker games, mainly because of arguments that poker is not simply a ‘game of chance’, which is prohibited under Brazilian law, but rather a game of skill.

Regulatory authorities

What entity regulates land-based and remote gambling, and what are the regulator’s powers?

General gambling activity is not allowed in Brazil. With respect to the gambling activities expressly authorised by law, the following are relevant.

LotteriesFederal and state lotteries

Except for the Exclusive Instant Lottery (LOTEX) and the Fixed-Odds Sports Betting, Brazilian law considers lotteries a public service exclusively carried out by the government that is not susceptible to concessions. In the federal sphere, the lotteries are controlled by the state-owned Brazilian Federal Savings Bank. In addition, some of the Brazilian states have their own lottery, which are run by the respective state governments.

The Secretariat of Fiscal Monitoring, Energy and Lottery of the Ministry of Economy is responsible for the authorisation, supervision, enforcement and regulation of lottery activities in Brazil.

In the Federal Sphere, the Federal Lottery Administration Service has powers to supervise, coordinate, inspect and control the execution of the Federal Lottery services across the national territory. Such powers include:

  • establishing agreements with the Brazilian National Mint to print lottery tickets;
  • guaranteeing that the rules related to minimum prize distributions and limitations on issuance of lottery tickets are observed by the Brazilian Federal Savings Bank; and
  • withholding and paying income taxes levied on the prizes.

There are three types of federal lottery:

  • draw-based games (Mega-Sena, Lotofácil, Lotomania, Dupla-Sena, Timemania and Quina);
  • numbers (the Federal Lottery); and
  • sports prognostics - pari-mutuel (Loteca and Lotogol).

LOTEX consists of an instant tickets lottery and is limited to the scratch-card sector. Tickets could be commercialised through physical retailers and/or online channels distribution. The LOTEX theme shall be related to emblems, hymns, symbols, shields and similar items related to professional sports organisations or events of great popular appeal, commemorative dates, cultural references, licensing of brands or characters, and other graphic and visual element. LOTEX may be explored by the state-owned Brazilian Federal Savings Bank, or by private parties through concession from the federal government.

LOTEX privatisation is currently ongoing and the participation in the auction is open to Brazilian or foreign legal entities, solely or jointly in consortiums, collective investment entities and investment funds.

The Ministry of Economy is the one responsible for authorising the concession, supervising and regulating LOTEX.

Fixed-odds sports betting

Fixed-odds sports betting consists of fixed-odds betting where the gambler predicts the result of a real sporting event. The gambler is notified at the time of betting of the amount he or she can possibly win in the case of a successful prediction.

This type of lottery consists of a public service that may be explored by private parties through a concession or authorisation. This service may be commercialised through physical or online distribution channels.

Different from LOTEX, one or more private parties may explore fixed-odds sports betting. The Ministry of Economy is responsible for authorising private parties to operate this lottery. Additionally, Law No. 13,756 of 12 December 2018 provides that the Ministry of Economy shall regulate this type of lottery for up to two years starting from law’s publication date. Therefore, the commercial exploration of the fixed-odds sports betting is pending on the upcoming regulation to be issued by the Ministry of Economy.

Horse races

Decree No. 96,993 of 1988 provides that the Coordination of Creation of the National Horse Commission (CCCCN), a government agency subordinated to the Ministry of Agriculture, has the authority to, among other things, authorise and inspect the exploitation of horse race betting, with or without obstacles. Unlike lotteries, bets on horse races can be carried out by private agents, upon the authorisation of the CCCCN.

Among such responsibilities, the CCCCN has powers to:

  • celebrate agreements with public authorities involved in the equine industry to perfect CCCCN’s objectives;
  • analyse requests to explore horse race betting and, if all conditions provided by law are met, issue the relevant patent letter authorising such exploitation;
  • authorise the operation and accreditation of betting agencies;
  • review monthly reports prepared by the authorised racecourses;
  • inspect the authorised racecourses’ books, balance sheets and any other documents deemed necessary; and
  • issue rules on doping controls, observing international standards on the matter.
Anti-money-laundering regulations

Are gambling licensees considered financial institutions for purposes of anti-money-laundering and similar financial services regulatory requirements or are they otherwise subject to such requirements?

Law No. 9,613 of 1998 sets the regulatory framework regarding money laundering and counter-terrorism financing measures in Brazil.

Although there is no specific rule under Law No. 9,613/1998 related to gambling licensees, it is important to note that the Control Counsel of Financing Activities, a government entity subordinated to the Ministry of Finance, is the entity responsible for receiving and processing reports on suspicious transactions and applying penalties to activities related to money laundering.

Therefore, game operators must comply with certain obligations provided by Law No. 9,613/1998 and Resolution No. 15/2007, such as:

  • customer due-diligence obligations;
  • identifying and reporting suspicious transactions; and
  • record-keeping obligations.

Land-based gambling


What types of land-based gambling are permitted in your jurisdiction, and is gambling regulated at a national or subnational level?

The two forms of gambling only permitted in Brazil are betting on turf competitions and lotteries. All other types of gambling are prohibited.

According to article 22, XX of the Brazilian Federal Constitution, the federal government has the exclusive competence to legislate over gambling.

Establishment licensing

Please describe the licensing criteria to operate land-based gambling of each type or classification. Does your jurisdiction limit the number of available licences?

LOTEX and fixed-odds sports betting may be explored by a private entity as a public service concession.

The application for a horse racing gambling licence should be made before the Ministry of Agriculture. The applicant must be a non-profit entity legally incorporated in Brazil, in ownership of a racetrack, and who also needs to demonstrate the technical and economic viability of the weekly racing schedule and the floorplan of the racecourse. That entity must present the draft of a general betting plan (which includes the rules applicable for each game to be run by the operator, such as prize, ticket value, minimum and maximum betting amounts and payout).

Director, officer and owner licensing

Must individual directors, officers or owners of licensees also be licensed or reviewed for suitability?

Current legislation does not require directors, officers or owners of licensees be licensed or reviewed for suitability.


May a gambling location be part of a resort, restaurant or other multi-purpose location? What limitations apply?

Current legislation is silent in this regard.

Passive/institutional ownership

Are there provisions for passive or institutional ownership that allow for exemption or modification of licensing requirements?

Current legislation is silent in this regard.

Responsible gambling

What responsible gambling obligations apply to licensees?

Current legislation is silent in this regard.


What type of tax and what tax rate applies to each form of lawful land-based gambling activity?

Brazilian law provides that prizes won on lotteries, horse races or any other kind of prize draw are subject to the following withholding tax:

  • for prizes paid in kind to:
    • residents in Brazil - 30 per cent of the prize;
    • residents abroad - 15 per cent of the prize; and
    • residents in a low-tax jurisdiction - 25 per cent of the prize; and
  • for prizes paid in goods or services to:
    • residents in Brazil - 20 per cent of the prize;
    • residents abroad - 15 per cent of the prize; and
    • residents in a low-tax jurisdiction - 25 per cent of the prize.

In the case of a prize paid to the owner of the horse in turf competitions, a withholding tax of 15 per cent is applied. In this case, if a legal entity is the owner of the horse and subject to the real profit regime taxation, the amount paid as withholding tax shall be deducted from the amount due as corporate income tax. In all other cases, the above-mentioned 15 per cent tax is the final income tax levied over those premiums.

In the case of prizes paid to Brazilian legal entities, such entities are also subject to social contributions on gross revenues (PIS/COFINS) and social contribution on net profits (CSLL) taxes.

Note that Law No. 7,291/1984 establishes that horse race betting operators must pay a monthly fee to the CCCCN based on the number of bets taken in the previous month, less the amount paid as prizes. The percentage that shall be paid will be based on the reference value (RV) published by the CCCCN and according to the following progressive accumulative scale.

Revenue on bets equal to:

  • between 1 and 2,500 multiplied by RV - shall be exempt;
  • between 2,501 and 3,500 multiplied by RV - a 0.5 per cent rate will be applied;
  • between 3,501 and 4,000 multiplied by RV - a 1 per cent rate will be applied; and
  • over 4,001 multiplied by RV - a 1.5 per cent rate will be applied.

Remote gambling


Is remote gambling permitted and, if so, what types?

Current legislation contains no provisions relating to online gambling, specifically. Horse racing entities already offer bets online in Brazil and the state-owned Brazilian Federal Savings Bank - the Federal Lottery operator - only offers online betting for their account holders.


What are the criteria for obtaining a licence to operate remote gambling?

Not applicable, since current legislation contains no provisions relating specifically to online gambling.

How do the licensing criteria for remote gambling operators differ from those applicable to land-based operators?

Not applicable, since current legislation contains no provisions relating specifically to online gambling.

Cross-border gambling

May operators located in other countries offer internet gambling to consumers in your jurisdiction without obtaining a licence there?

Operators located abroad cannot offer internet gambling to consumers located in Brazil. Law No. 13,555 of 2015 added a new paragraph 2 to article 50 of the Law of Misdemeanours to punish both the operator and the consumer, regardless of whether gambling is land-based or carried out remotely (eg, through the internet or any other form of communi­cation) with a fine between 2,000 to 200,000 reais.

May operators licensed in your jurisdiction offer internet gambling to consumers in other countries?

Current legislation contains no provisions relating specifically to online gambling.


What tax rate applies to each form of remote gambling?

Brazilian law does not differentiate land-based gambling from remote gambling. Therefore, the same tax rules enforced on land-based gambling (see question 15) apply to remote gambling.

Intellectual property


Are gambling games - land-based or remote - patentable in your jurisdiction?

Yes, the general rules applicable to patent protection also apply to gambling games in Brazil. In this sense, it is important to note that patent protection in Brazil is only obtained and assured by registering it with the Brazilian Patent and Trademark Office (BPTO), meaning that if an invention is not protected by means of a patent, in principle, anyone is able to freely use it.

Note, however, that Brazilian law prohibits registration of logos that identify illegal gambling activities. In this context, if the registration request submitted to the BPTO classifies the logo as illegal gambling-related, that public authority will refuse the registration request on the grounds that the activity related to the logo is prohibited in Brazil, regardless of whether the logo is already registered in another jurisdiction.


Are there limitations on how brands, logos or other types of marks may be used in promoting gambling games?

Brazilian law authorises the promotion of lotteries under certain limitations. Regarding the use of brands and logos, the use of the expressions ‘Federal Lottery’, ‘Federal Lottery of Brazil’, ‘National Lottery’ and other similar expressions can only be used by the Federal Savings Bank, the Federal Lottery Administration Service and the Board of the Federal Savings Bank for the promotion of the federal lotteries. An exception is made for entities authorised to distribute prizes, and these are only authorised to use them on prize draw announcements or promotion of the lottery drawing results.



What types of restrictions apply to advertising gambling games?

According to article 57 of the Law of Misdemeanours, publishing, even if indirectly, the operation or results of unauthorised lotteries in newspapers, radio or through any other means is a contravention, punishable by a fine. The Law of Misdemeanours is silent regarding the other gambling modalities. As a general rule, advertising in Brazil is regulated by the Brazilian Self-Regulation Advertising Council (CONAR, which is a non-governmental agency). According to CONAR, advertisements that may induce, favour, commend or stimulate criminal or illegal activities are prohibited.


While advertising of gambling games is prohibited in Brazil, there are certain restrictions applicable to lotteries. In addition to the limitations on the use of the Federal Lottery brand (see question 23), advertisement of the federal lotteries is attributed exclusively to the Federal Savings Bank, the Federal Lottery Administration Service and the Board of the Federal Savings Bank.

Moreover, Brazilian law also establishes that the promotion of lottery announcements, notices or drawings in locations where the relevant tickets are not authorised to circulate is considered a criminal contravention and, therefore, is subject to penalties and fines (see question 4).

Horse races

Every horse race is bound to the rules provided in Decree No. 96,993 of 1988, the National Race Code and the General Bet Plan of each authorised racecourse, approved by the CCCCN.

Such laws and regulations are limited in providing general advertisement guidelines on the authorised racecourses’ betting system, such as:

  • the General Bet Plan of each authorised racecourse must be affixed in locations accessible to the public within the racecourse premises; and
  • the General Bet Plan must establish the different betting modalities available in a manner that the gambler can be perfectly aware of the betting procedures, calculations, apportionments, percentage of withdrawals and other peculiarities of the betting system adopted by the racecourse.



What types of suppliers to gambling operators require licences?

Licences are not required for suppliers to gambling operators.


If licensing is not required, is there a registration or other process suppliers are subject to, and what triggers that process?

There is no registration or other process required for suppliers to gambling operators.

Casino projects

Casino development

What considerations arise in developing a casino resort project that are not typical to other resort development?

Not applicable, casinos are banned in Brazil.

Labour and employment

Wage and hour rules

Are there particular rules governing hours and wage treatment for casino employees?

Not applicable, casinos are banned in Brazil.

Collective labour

Must casino employees be members of labour unions or similar organisations?

Not applicable, casinos are banned in Brazil.

Acquisitions and changes of control

Change of control

How are licensee changes of control, and substantial changes in shareholdings of licensees, addressed?

Current legislation is silent in this regard.


How are gambling licences treated in bankruptcy?

Current legislation is silent in this regard.



How are forms of ‘quasi-gambling’ regulated? Are any treated as ‘gambling’, and what triggers such treatment?

There is no specific regulation for ‘quasi-gambling’ in Brazil. In any case, the Law of Misdemeanours must be observed and any breach of it may cause ‘quasi-gambling’ to be treated as gambling.


Does your jurisdiction license quasi-gambling operators?

Licences are not available to quasi-gambling operators.

Other restrictions

Does your jurisdiction impose other restrictions on the conduct of quasi-gambling activity, including restrictions on advertising, age of participation, limitations on prizes, etc?

Not applicable, there is no specific regulation for ‘quasi-gambling’ in Brazil.


Recent cases

What, if any, significant litigation involving the gambling or quasi-gambling sectors has your jurisdiction seen in recent years?

The particular approach to gambling in Brazil has reflected on related litigation in the jurisdiction. Naturally, the restriction of the major gambling activities to state-owned entities (SOEs) has resulted in all the major disputes involving the federal and state branches of the government and focusing mainly on issues of public law.

The major cases that bear some relation to the gambling industry are those involving service providers retained by SOEs and that address issues concerning compliance with public procurement law, as well as performance of the corresponding contracts entered into with the SOEs. Such contracts are governed by a specific set of rules forming a complex legal framework, which are the source of relevant discussions.

Also, there are important disputes related to the tax regime over lottery-related services. Such disputes involve SOEs, service providers and different entities of the Federation, addressing specially ICMS Tax and its impact on the price structure of the contracts entered into between SOEs and its service providers.

Finally, in terms of international litigation, it is worth mentioning that the Brazilian Supreme Court, through different precedents, traditionally considered that foreign decisions (judgments or arbitral awards) on gambling-related debts could not be enforced in Brazil. The rationale was that such decisions would be contrary to Brazilian public policy. However, after the authority ratifying foreign decisions in Brazil shifted from the Supreme Court to the Superior Court of Justice, the prevailing view also shifted. The Superior Court of Justice indicated that it will favour a view that is more aligned with the international concept of public policy. The Court has already ruled that decisions ordering collection of gambling-related debts are, in principle, enforceable in Brazil, as long as gambling is legal in the place where the debt was constituted. In addition, the Court has authorised that defendants located in Brazil receive service of process from lawsuits filed abroad seeking collection of gambling-related debts.

Update and trends

Recent developments

Highlight any noteworthy developments or trends in the gambling or quasi-gambling sectors (legal or business) and their potential implications.

Developments36 Highlight any noteworthy developments or trends in the gambling or quasi-gambling sectors (legal or business) and their potential implications.

Currently, two bills are being discussed in the Brazilian Congress aiming to legalise gambling: Bill No. 186/2014 and Bill No. 442/1991. The latter was proposed by the House of Representatives, the former by the Senate. Both bills are running simultaneously and rule over the commercial exploration of gambling within national territory authorising Jogo do Bicho, slot machines, bingo, casinos and sports betting games among others.

In March 2019, Bill No. 186/2014, which was approved by every Senate commission, has been unfiled and is ready to be voted on by the Senate’s plenum.

In May 2019, an institutional group, composed of 198 representatives and five senators, was established in Congress aiming to approve the legalisation of the commercial exploration of games of chance.

The Brazilian Supreme Court is currently analysing the constitutionality of article 50 of Decree No. 3,688/1941, which criminalises the exploration of gambling in Brazil. In case the Supreme Court understands that such a legal provision is not compatible with the Brazilian Constitution enacted in 1988, exploration of gambling will cease to be a criminal activity in Brazil.