Brazil to Regulate Casino Gambling

Brazil GamblingFor 75 years Brazil has imposed a gambling ban. Now it is under review to help plug the nation’s budget deficit. In Brazil gambling is under review.

In 1941 Brazil outlawed gambling in Brazil as part  of their Criminal Contravention Act. President Eurico Dutra issued a decree to shut down all existing casinos.

Currently only Lotteries, as well as poker and betting on horse races are legal. The latter were accepted as skill based activities.

A São Paulo lawyer who specialises in gaming, Luiz Maia was quoted as saying that multinational clients were already discussing local partnerships. Some real estate contract have already been signed in advance of the proposed legislation.

The lower house and senate are considering two Brazil gambling legislation bills. One includes proposals for foreign operators to partner up with a local operator. Another would restrict the number of casinos any one company could own. It is expected that online betting will remain illegal because of social issues. Presidential sign off is required and that could happen this year.

Taxation will be a major consideration. It has been reported that Brazil is losing R$6bn a year in taxes in the R$20bn illegal gambling market.

Brazil Gambling After Legislation

A number of key gambling operators have already been lining up. US Casino Group MGM Resorts, William Hill, Ladbrokes, Bettson and Netent have all be implicated in discussions. Brazil will be very keen to regulate gambling in a way which will minimise the possibility of corruption.

It has been reported that Sheldon Adelson is contemplating making an 8 billion dollar bid for a casino in  Rio de Janeiro.

The prospect of legalizing casinos could create a bright future for Brazil. Typically it can create 1% of GDP in revenue. Large scale resorts could bring big business to the large cities like Rio de Janeiro and São Paulo. A large boost to tourism could be on the cards from gambling in Brazil.

Is Brazil following the same path as Japan and Australia to maximise revenue from gambling? The taboo of gambling is gradually being swept away with economic advantages being favoured over social disadvantages.

The reality for bricks and mortar casinos is that entry can be limited by security. The target for casinos in Brazil would be tourists or middle class Brazilians some whom are quite wealthy.

Source: FT.com

Read more about Brazilian Gambling Legislation.

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