SPA'S public consultation brings structural changes to the service providers in the betting market

As a follow-up to our previous communication regarding the public consultation opened by the Secretariat of Prizes and Bets of the Ministry of Finance (SPA), we would like to draw special attention to the new and relevant details recently disclosed concerning the proposed regulation on the engagement of service providers by fixed-odds betting operators, available for consultation on the Brasil Participativo portal.

The draft Ordinance is particularly relevant because it introduces, in Brazil, a specific and structured regulatory framework for suppliers in the betting market, with the potential to impact the functioning of the sector as a whole. Although the regulatory focus falls directly on suppliers, the practical effects of the proposal also extend to authorized operators, as they will only be allowed to engage service providers duly recognized by SPA.

In practical terms, the proposal introduces a new layer of regulatory oversight over the supply chain, with relevant operational, contractual, corporate, and compliance implications, especially for international suppliers and for operators that rely on outsourced technology and content solutions.

Under the proposed regime, betting operators will only be permitted to engage suppliers whose operational capacity has been formally recognized by SPA, through an individual Ordinance expressly defining the scope of authorized services. Recognition will be granted for a period of three (3) years, subject to renewal, provided that the required regulatory conditions remain satisfied.

The proposal establishes a transitional regime, pursuant to which:

Once the transitional period ends, the provision of the regulated services will only be permitted after the issuance of an SPA Ordinance formally recognizing the supplier’s operational capacity, which will require prior regulatory and contractual planning by the relevant stakeholders.

The public consultation is open from February 4 to March 23, and contributions may be submitted both regarding the wording of the draft Ordinance and the underlying regulatory and public policy aspects of the proposal.

In our preliminary assessment, the draft text still allows for relevant improvements, both from a legislative drafting standpoint and from the perspective of regulatory proportionality and legal certainty for market participants.

In our view, there is concrete room for contributions that may assist SPA in providing greater procedural clarity, calibrating requirements according to the nature and risk of the different types of services, as well as considering mechanisms for regulatory reliance for suppliers already certified or authorized in mature betting jurisdictions.

In this context, we understand that qualified participation in the public consultation may effectively contribute to improving the final text and to building a more efficient and balanced regulatory framework for the Brazilian betting market.

We remain fully available to discuss the potential effects of the proposal and to assist in the drafting and submission of contributions to SPA, including from the perspective of international suppliers and economic groups operating across multiple jurisdictions.