President Lula bans licensed online betting in Brazil from 6 October, orders player refunds

Brazil has gone from regulating online betting to effectively shutting the licensed market down. President Lula issued a provisional measure that blocks all licensed betting sites from 6 October and requires operators to refund player balances through their banking partners — a move that creates immediate payment and settlement risk for the sector.

1. Under the measure, no operator may accept customer deposits once it is published. Bettors have until 5 October to withdraw their funds voluntarily. After that, sites must credit the balances held in registered accounts between 9-14 October.
2. All licensed sites will be blocked starting 6 October, including websites and apps. Operators must still return the money even if the customer does not initiate a withdrawal during the 9-14 October window, and they must do this through their partner banks.
3. Brazil’s Minister of Finance, Dario Durigan, announced Lula’s decision and said the Secretariat of Prizes and Bets (SPA) had already taken steps to regulate the industry and protect families from indebtedness. According to him, those measures were not effective, and the government cited severe cases of gambling addiction as the reason for a total ban.
4. The government also laid out a separate enforcement timetable: 7-8 October for operators to consolidate customer balances by CPF; 9-14 October for full refunds; and from 14 October, Caixa Econômica Federal will help process refunds if operators or banking partners run into difficulties.
5. On the enforcement side, the government will submit an urgent bill to the National Congress introducing criminal penalties for anyone who runs, operates or promotes sports betting. The proposed penalty is four to six years of imprisonment plus a fine, while institutions that process betting payments would face two to four years in prison.

For PSPs, acquirers, and banking partners, the key point is that this is not just a licensing change. The state is explicitly putting payment rails in the middle of the unwind, with refund obligations, deadline pressure, and a fallback role for Caixa Econômica Federal. With almost 90 licensed companies, all of which paid BRL30 million ($5.8 million) in licence fees, litigation and attempts to recover funds are the obvious next step.