Brazil bans online betting from October 6, less than two years after legalization

President Luiz Inácio Lula da Silva has signed a provisional measure that shuts down online betting operations in Brazil with immediate effect on deposits, and the rest of the market is on a very short fuse. For PSPs, acquirers, and bank partners, the key point is simple: licensed sites and apps are being blocked, refunds are being forced through a fixed timetable, and payment intermediaries are now in the legislative crosshairs.

1. Under the measure, players must withdraw their balances by October 5. From October 6, all licensed betting sites and apps will be blocked in Brazil. On October 7–8, operators must reconcile remaining customer balances by tax ID, and from October 9 to 14 they must return all funds to players, whether or not those players requested a withdrawal.
2. If an operator or its banking partners have trouble completing refunds, Caixa Econômica Federal, the state-owned bank, will step in from October 14 to handle the process.
3. The measure was presented by Finance Minister Dario Durigan, who cited the ineffectiveness of earlier steps to protect families from debt and severe cases of gambling addiction. Lula himself criticized betting for draining household budgets and making sports clubs too dependent on bookmaker sponsorship.
4. The government will also submit an urgent bill to Congress that would create criminal liability for organizing, operating, or promoting sports betting: 4 to 6 years in prison plus fines for operators, and 2 to 4 years for payment intermediaries.
5. About 90 companies were operating under license at the time of the ban, each having paid 30 million reais ($5,8 million) for a license. Lawsuits over refunds and compensation are expected. ANJL has already said it will challenge the measure in court, calling it unprecedented for the global industry and warning about lost tax revenue, thousands of jobs, and a shift of players into the illegal market.

IBJR, Brazil’s Responsible Gaming Institute, also warned about serious economic and legal consequences from shutting down a market shortly after it was formalized. One open question remains around states that had already regulated sports betting through their own lotteries.