Key Points
- The Supreme Court is set to hear the dispute over the ban on the 3rd November, but don’t expect the ban to be lifted just yet. No injunction has been put in place.
- The operators paid out a whopping R$ 2.55 billion in fees for their licences, but they won’t be getting that back anytime soon, as those licences have expired.
- If the government lets the ban lapse, those licences won’t automatically spring back to life, it’s not looking good for operators.
Brazil’s betting industry is at a crossroads, but for now, it’s been dealt a bit of a setback. One day after 85 betting licenses had expired, the Supreme Court announced a hearing instead of rushing out a decision. Justice Luiz Fux wants to hear the arguments before making up his mind, so the ban is still firmly in place for now. The big question is whether that 3rd November hearing will do anything to help the industry, or just give the government a bit more time to dig their heels in
Hearing Set, Ban Remains
Fux has scheduled a public hearing for the 3rd November at 10 in the morning in front of the Second Panel of the Supreme Federal Court. And he did it on the 26th, just a day after those licenses expired. But there is a catch, the order didn’t include an injunction, so Provisional Measure 1, 394 remains in effect.
President Lula signed that measure on the 25th September, it effectively bans any fixed-odds betting, including your average online casino games. And reportedly, Fux held off until after the runoff to avoid accusations that he was favouring one of the candidates. But the court order itself makes no mention of this, so it’s fair to say it’s just some reported background info.
The case, ADI 8, 027, was brought by the National Association of Games and Lotteries, known as ANJL, and they’re really keen to get the court to put the brakes on this measure till either Congress or the court has a say in it. The hearing order also includes the Brazilian Institute for Responsible Gaming as an applicant, and both organisations want the court to hold off on the measure till they can get some clearer guidance.
And Here Comes the Agenda (Sort Of)
The order names 26 entities that are going to be participating in the hearing, and they include all sorts of industry organisations, the finance ministry, broadcasters and ten football clubs. But Flamengo, Corinthians and Sao Paulo are among the clubs listed, along with the Brazilian Football Confederation, however the order won’t be telling you who speaks when or what the agenda will look like.
Some of the trade mags are expecting the economic impact to be a major talking point, but this is just speculation at this point. Fux has also tied this hearing to six related cases, so you can expect this one to get tangled up in a few other legal disputes. When it comes to making a decision on the injunction request, well, there’s no deadline just yet. If he does take a decision on his own, the whole court will have to ratify or overturn it. The Supreme Court has held similar hearings before, in fact they had a two-day hearing just last year.
Unrecoverable Money
The 85 authorisations expired on 25 October with no compensation. As such, it marked the close of the market that was launched in January 2025. Each of the 85 federal authorisations cost R30 million for five years, thus requiring operators to pay R2.55 billion in grant fees. According to Carlos Lima, the CEO of IBJR, operators have additionally invested about R$7.5 billion in share capital.
Lima’s prediction reaches beyond the betting sector. “Legal certainty implies the predictability that is required for investments,” he stressed. Investors who consider launching projects in other Brazilian sectors, like airports, ports, and telecommunications might closely monitor this case as well.
Job cuts were felt almost immediately. An ANJL survey registered over 3,500 layoffs in the first 14 days. One should approach this statistic carefully since it originates in the industry. At the same time, consultancy LCA expects that up to R$73 billion in revenues could be at risk in 2027-2030. It is a prediction of potential exposure rather than the amount the sector lost already.
Football clubs are feeling the consequences too. According to industry associations, betting companies paid Série A clubs more than R$1 billion in 2025.
Two Sets of Numbers
The government relies on household debt and gambling harms when explaining the decision to ban betting. Both issues continue to play an important role in the controversy. Minister of Finance Dario Durigan claimed previously that previous protective measures had been inefficient. AGU asserts that the previous betting framework contained serious problems, including poor protection of minors and poor anti-money laundering procedures. These are government arguments, not findings of the court.
The government also claims that it referred 10,435 illegal websites for blocking between 25 September and 1 October. Industry associations dispute the urgency of the ban and bring their numbers to the discussion. ANJL and IBJR say that the decline of 42% in the financial volume between October 2025 and June 2026 undermines the argument of urgency. This number is used in their lawsuit, but no court has decided that the government did not prove urgency yet.
A study made for IBJR estimates the illegal betting market share between 41% and 51% in 2025.
Fux’s Record Before the Hearing
Judge Fux, we’ve learned, has a history of dealing with cases linked to gambling. In a different case concerning land-based gaming, he voted for keeping games of chance off the books back in August. ‘The state is there to keep the individual from himself,’ he basically said in that judgment.
Justice Flávio Dino has put that land-based case on hold, and actually wants the court to consider online betting as part of the mix. Justice Dias Toffoli seems to agree with Fux on the ban on land based games, but what that tells us is it can’t tell us exactly how Fux will play it out with online betting.
Congress and the Licence Question
In the meantime, Congress is chugging along on its own timeline, unaffected by what the court does or doesn’t do. As of 23 October, the joint committee looking at the new measure still hadn’t been set up. If things stay that way, the whole shebang comes to a halt on 9 November, and by 23 November, the first 60 days will be up. And guess what, even if Congress is on recess, that timeline just keeps ticking away, so it could drag on until March 2027.
Lawmakers have sent through nearly 100 amendments, with most of them wanting to keep sports betting going while nixing casino games online. According to NEXT.io, the whole thing could collapse without automatically bringing the expired licences back to life. Because in that case earlier laws would remain on the books.
Regulus Partners reckons the measure has an 80% chance of falling through while the licences stay expired, which isn’t a legal ruling, just a forecast. And as everyone knows, things can change in a heartbeat. Folha de S.Paulo thinks this hearing might actually be a chance for the government, operators and clubs to hammer out some sort of deal.
Expert Analysis: The Hearing is a Knotty Situation for Everyone
Our take is that this hearing gives both sides a chance to make their case, but it doesn’t mean we’ll get any clear answers right now. The government can just keep the ban in place and let the court sort things out. Clubs and industry groups will get a turn to air their grievances, but just getting heard doesn’t mean they’ll get the outcome they want.
One thing’s for sure: shutting down the market before the government had to deal with another round of debate over the measure really muddies the waters. If the government needed to have another chat about this measure, it’s much harder for them to explain why they shut down the market first. That’s our 2 cents, but the government might still manage to spin this into a case for taking action fast.
Fux basically said in August that the harm caused by gambling is a major worry. Based on that view, it’s unlikely the court will just restore the market to what it was before, but that’s not a prediction, it’s an interpretation. The land-based and online gambling cases are apples and oranges after all. A more modest outcome, like a transition period, looks like a more realistic outcome to us.
So the question isn’t just about whether the ban stays in place, it’s also about who’s going to cough up the R$2.55 billion in grant fees that operators already shelled out.
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