Lula declares fixed-odds betting regulation a failure after 22 months under Brazil’s Finance Ministry

Brazilian President Luiz Inácio Lula da Silva has used a Band interview to justify MP 1.394/2026 by saying the country’s betting regulation “did not work” and would be shut down. For high-risk payment providers, the awkward part is obvious: the legal market was regulated by Lula’s own Finance Ministry, while the illegal one now gets a freer run.

1. On Sunday (27), Lula told Band: “But if it didn’t work, we were going to close it. It didn’t work,” two days after signing a total ban on bets and online games in the country, nine days before the first round. The measure is MP 1.394/2026.
2. The regulation he is criticizing was built by Lula’s own economic team. Between 2024 and 2025, the Ministry of Finance issued the rules through the Secretariat of Prizes and Betting (SPA/MF), charged R$ 30 million for authorization, and required companies to hold minimum capital, maintain a headquarters in Brazil, implement anti-money-laundering controls, and use responsible gambling tools.
3. Official numbers point to a functioning regulated market, not a dead one. The Finance Ministry said, under Brazil’s Access to Information Law, that gross gaming revenue (GGR) reached R$ 36.9 billion in 2025 and R$ 20.07 billion in the first half of 2026. The market paid taxes, identified each bettor by CPF and facial recognition, and reported every transaction to the regulator.
4. According to a manifesto signed by nine industry associations, the regulated market already blocked access for 3 million Bolsa Família and BPC beneficiaries and had received more than 1.2 million self-exclusion requests. None of those protections exist on clandestine platforms, which is the part that actually matters if you care about payment rails and player controls.
5. The real failure, as the Tribunal de Contas da União said in Acórdão 1296/2026-Plenário, was enforcement against the illegal market. The audit found that unauthorized operators account for 41% to 51% of total wagering volume in the country, with annualized revenue between R$ 26 billion and R$ 40 billion, and said domain monitoring is reactive, depends on complaints and manual searches, and does not coordinate financial and tax tools properly.

The same industry groups said more than 66,000 irregular domains have already been blocked, yet in a single week in September 6,409 illicit sites were still operating normally, with 14 new illegal addresses appearing per day. The upshot is simple: after 22 months of regulation, the state failed to take the illegal competitor offline, and the MP takes the legal competitor offline instead.

The first immediate knock-on effect landed over the weekend. On Saturday (26), the Associação Nacional de Jogos e Loterias (ANJL) notified Sportradar that cooperation on match-fixing prevention and detection was being terminated. The agreement, signed in February, had included sports integrity monitoring.