iGaming Daily

Fer (00:02.543)
We are on the verge of all things new, sang Billy Joel once, and all of a sudden, Brazil has realized what he meant. Welcome to a new iGaming Daily Podcast episode, I'm Fernando Nott, Senior Journalist for SBC Noticias, and I'm joined today by Lucia Gando, SBC Noticias Editor aka The Boss. How are you, Lu?

Lucía (00:25.55)
You made me sound Brazilian, I think.

Fer (00:29.007)
Yeah, it's like we are both from Argentina and we tend to add like this... like that sound to everything, like every consonant we have we can and we think that makes us sound Brazilian. But if we're talking about sounding Brazilian, why don't we have ourselves our very own Brazilian and let's introduce Isadora Marcanchi.

Senior journalist for SBC Noticias Brasil, Isa. It's been a while, actually. How are you?

Isadora (01:03.366)
Yes, it's been a while we are not like everyone together and chatting so it's really good to be here and I'm really good. Thank you.

Fer (01:11.375)
I see you are in the warm João Pessoa while we are in the cold Buenos Aires entering the winter, we're almost there, so different weather for us. But let's discuss what's coming for Brazil because lots of things have been going on over the last few weeks in the country with their new regulations seemingly soon to be completed.

Let's go back first to the very last hours of 2023. Let's remind our listeners that that's when Lula da Silva, the president, signed the bill for iGaming and sports betting into law. But that didn't necessarily mean that everything was ready because only the law had been signed into only the bill had been signed into law. Now the the country still needs the government to sort the details out with the famous portarias.

I think that's a major word, like a key word for our Brazilian discussions, which are the documents that set the rules for each aspect of the industry. So Isa, why don't you tell us about the latest developments around specifically the portarias in Brazil?

Isadora (02:11.302)
Hehehehe

Isadora (02:28.55)
Well, it's going quite fast actually I must say that I'm really impressed I didn't think that it was going to happen that quickly that we're going to have like a lot of Porter Porter yes or law ordinances published But right now like what we see is like after the first portaria mentioning like the general rules for operators that would like to enter and operate in Brazil we have We have been seeing other port areas being published such as the payments one

which is I think a portaria we should discuss a bit more because a lot of operators are happy with it, a lot of operators are not happy with it, that this law ordinance set the rules for payment methods and payment transactions inside the Brazilian territory. And we also have like more technical law ordinances such as.

all the companies based in Brazil that would like to offer sports betting and online games. The customers need to have the bet .br in their URLs. They need to have a center database in Brazil for all the data from the clients and the players. And we also have, like you mentioned, last year Lula signed the bill into law.

that regulates the sports betting market in Brazil. But his veto, like the articles that talked about the tax exemption for the players, so they wouldn't have any tax exemption on their winnings. And the Congress right now, they just took down this veto and went back to what it was before. So the players have a tax exemption. They don't need to pay any tax on their winnings up to 2 ,000.

2500 something in Brazil before was 2112 now is 2500 something I know I don't know exactly the numbers but it's like something that the federal like the hesita federa like this federal revenue of Brazil just decided and Well, we have a very important player in this market that is IB

Isadora (04:46.278)
JR, they are an organization that promotes a safe environment and responsible gambling in the industry in Brazil. They really didn't like that much this new law ordinance because right now the players will have to pay taxes up to the tax exemption, but like if it goes up to that, they will have to pay taxes on each winning.

not like after a year of betting, not after a year of collecting awards money, they will have to pay taxes on each winning every day. So if I spend, I don't know, like 200 BRL today and 300 tomorrow and 50 next week, I will have to pay taxes on each winning that I have and the losses will not be counted. So I think that's an issue that we have. But coming back to the payments law ordinance.

I think that's the one that caused more, that had a louder noise in Brazil, amongst the operators and the payment providers as well, because they won't be able to accept payments in cryptocurrency. They won't be able to accept money from cryptocurrency. They won't be able to accept money with credit cards as well, that we see quite often.

Overseas but here right like right now they cannot accept they won't be able to offer bonuses for the players like welcome bonuses to attract clients and that is something that concerns a lot of operators because they said that this could lead players to the parallel market as well because you have like other companies Offering bonuses companies that are overseas and you have VPN as well. So you can connect to your VPN and access and

international websites that are not based in Brazil. And apparently the government will accept occasionally offshore companies. So that will be even a bigger problem. So if you cannot offer bonuses to attract clients, but you have overseas companies offering sports betting to Brazilian players, how you're going to control that this player will not go to the company?

Isadora (07:10.982)
offshore like outside of Brazil and not you're not gonna collect taxes here anyways if the player is not playing in a company that is based in Brazil so it's a very I would say sensitive discussion right now but we see a lot of operators happy with that as well like we hear them saying that that will be good that will level up the game that the marketing will have to to use like better and more

let's say, responsible strategies to attract clients that don't include offering big amounts of money for them to sign up. So basically, that's like a whole summary of what's happening in Brazil right now.

Fer (07:54.127)
You mentioned payments and let's promote some old episode or another episode than this. Episode 248 of iGaming Daily. You interviewed Aricelia from Pay for Fun. So you sure want to go listen to that episode about Brazil through the payment lens with Aricelia hosted by Isadora. So after this episode, don't go now. Stop, stop right there.

Don't go now after this episode is finished, you go and listen to episode 248. But Issa, you mentioned there's other portarias like smaller. Are there still many portarias, many law ordinances to be issued? And when can we expect all this process to be done?

Lucía (08:24.782)
Thank you.

Isadora (08:42.822)
Yes, we have in total 12 law ordinances to be published. So we're still waiting for a couple more to be published. And according to the agenda of the awards and prizes secretary of Brazil, they are predicting to be published, all of them, by the end of July. So if this happens, then we'll have a more organized and settled

regulated environment for the sports betting online and online games in Brazil. Let's see if this is happening. I think you will like seeing what everything that is going on right now and how fast they are publishing things and crediting laboratories to be to testify the the games in Brazil and the and the websites and and all the work that they have been done since the secretary was created and they.

and they had Simone Vicentini in charge when Mansoor left. So it's... Let's see, but I think that we will see everything done by the end of July. Yeah.

Fer (09:55.471)
Okay, hashtag Brazil, wait and see, are already infamous hashtag, but we're getting close to July, so we don't have to wait so much right now. But in the meantime, while all this is happening, like the law ordinances are being prepared and everything is being discussed, there's a parallel thing that maybe is not as good for the image of the industry, which is...

Isadora (09:59.302)
As always.

Lucía (09:59.374)
Yeah.

Fer (10:23.695)
a commission from the Senate investigating match fixing in Brazil. Of course, some organizations involving sports betting that have been involved in match fixing in Brazil. There was a major investigation last year about this whole issue. So how does that impact this commission investigating match fixing? How does that impact the industry amid all this regulatory debate?

Isadora (10:52.71)
Well, sadly, this is happening in a country, Brazil, that is very divided when it comes to sports betting and online games. The population don't really understand what the industry is and how the industry works. So we see people saying that is the worst thing on earth to legalize and regulate sports betting and online casinos. And right now, eventually, they are discussing.

the possibility of allowing land -based casinos and bingo games to be legalized in Brazil as well, which is another major issue, but we can talk about that later. But...

Fer (11:39.919)
It's okay. We were talking about how it impacts how the Senate Commission investigating match fixing in Brazil impacts on the industry regulation because right now, let's go back. There's John Texter, owner of Botafogo, actually filed a lot of evidence about or potential evidence about match fixing in Brazil. Actually, there was a push to stop

the Brazilian football league, the top flight football in Brazil was being called to stop by a referee organization that didn't actually happen, that kind of like died down. But it sure has got the attention of the public opinion, right?

Isadora (12:30.534)
yeah, definitely. Like I mentioned before, it's really divided. So like it's, it could, I mean, obviously like mitigating all the damages that fraud in betting and match fixing can have in sports and in the industry in general, in the sports betting industry, it's really important. So we need to have those investigations. And the only thing, like the only reason why this commission was set up to place right now is because...

even though we had a major operation in the end of 2022 and through all 2023, we still see matching fiction issues in Brazil and quite a good number of problems. So obviously right now they're still hearing everyone like CBF representatives and club representatives as well, like sports clubs and representatives.

But it could have like, looking as someone that is part of the population of Brazil, a lot of people will look at it and say like, see, that's why sports betting shouldn't be regulated. The problem is sports betting. But we've been seeing match fixing since before that, since before sports betting was a thing, since before the internet came. So the thing is, like, of course, internet.

allows you to maybe do more of what you did before and in an easier way. But the problem is not the industry. The problem is the people around it and how we can prevent this from happening. That's why we will have a law ordinance about match fixing. That's why we'll have a law ordinance in Brazil about responsible gambling. How we're gonna prevent fraud from happening. How we're gonna prevent...

match fixing from happening. We need to prevent things, not to like forbid the industry, because the industry is not the main issue. But it's really hard to say how this will have, I mean, I think it's a good thing. You have to identify what's happening. You have to punish people that are doing this to not damage anymore like the image of the industry and the image of sports in Brazil, especially football. But it's still like population might see this as a

Isadora (14:54.47)
Okay, wow, that's maybe not a very good thing to have sports betting and online games regulated in Brazil.

Fer (15:02.415)
But if you want to stay up to date with all the news about the Commission investigating match fixing, the law ordinances and everything about Brazil regulation, be sure to stay tuned to the iGaming Daily podcast of course and also subscribe to the newsletter of sbcnoticias .com slash BR as in Brazil. And we couldn't be talking about Brazil and leave out.

our good friends down in Brazil that are actually struggling right now. So we wanted to extend a warm hug and send all our love and strength to the people affected by the floods in Rio Grande do Sul. So here's our message for you guys. And if you want to donate and contribute and help the people affected by these floods, we will leave a link in the description so you can make a donation for.

the people affected by the flood there down south in Brazil.

Okay, so now this is the break and now Isa you will take the lead. You have the text I wrote and now we can discuss very briefly because we are already by 15 minutes I think of the podcast. So now it's okay. The most important is Brazil. So yeah, yeah. I was worried we will talk too little.

Isadora (16:15.59)
Yeah.

Isadora (16:23.59)
I talked too much, sorry.

Lucía (16:24.49)
No, that's good.

Isadora (16:33.542)
I'm really talkative today.

Lucía (16:36.878)
That's good.

Fer (16:36.899)
That's good, that's good. Okay, whenever you're ready.

Isadora (16:43.43)
Okay.

Isadora (16:46.79)
Can I go? Yeah? OK. Well, while Brazil is still working on its regulation, Argentina has been making progress with its own over the last few years. However, with the regulation of online gaming came more exposure for the industry, and now there are new issues to be tackled. Each Argentinian province has its regulatory framework, and there are no nationwide rules. But the concerns,

seem to be the same all over the country, right? Lua and Fer. So with the market now regulated in most territories, the problem lies now with the unauthorized operators that seem not to have major issues to be up and running. Meanwhile, license companies promote their businesses through advertising on TV and sporting events, but seem to have become a target for the public opinion, which calls for restrictions on advertising. Fer, about that.

What seems to be the major concern with iGaming operations in Argentina right now?

Fer (17:52.879)
Well, like you very well said, the regulation has become, has turned the industry into a target because of course, like we always say, the industry used to exist before regulation. People used to bet before the industry was regulated, but after regulation, things became more like tidy and you know, with operators, more clear, thank you. And...

Lucía (18:17.486)
Clear.

Fer (18:21.487)
with operators paying taxes and proper measures to protect consumers enforced and the licensed operators actually enforcing those measures proposed by each government. And like you said, Argentina has a very particular way of regulating where there's no nationwide rule. Like there's not a single legislation that sets the rules for the whole industry in the whole country, but each province has to

pass its own regulation for the gaming industry, much like happens in the United States, for example. So with this in mind, the industry has become a target because while many companies applied for licenses and did their homework and got their permits to operate and are enforcing every regulation and protection measure, there are some operators that are

are not like illegal operators are still working in Argentina and actually 80 % of the volume of betting in Argentina is illegal operations. This is information from the actual regulators. So with this in mind, there's some concerns about underage gamblers, underage miners playing in this illegal website because...

With the license operators, you don't have that issue because they have measures to prevent minors from entering their platforms. Like you have to enter your tax information or different types of information from yourself to actually be able to bet on the license platforms. In illegal platforms, you don't. You just can't.

use a digital wallet or something like that to fund your account and bet online without any restrictions. So what's happening right now is that lawmakers are seeing the industry as a whole, both the illegal and the legal operators. So they are pushing in both nationwide and in some provinces laws to restrict gambling.

Fer (20:44.815)
to set more restrictive rules for the industry, both in advertising and the actual operations. Like some provinces are pushing for biometrics to be enforced in the registration process, so miners don't use their parents' information to bet, which is actually not as common as it is for miners to be betting on illegal websites, which are the most easy to bet on.

So there are some pushes in some provinces and also nationwide to restrict the industry. And that is actually the major issue in Argentina right now.

Lucía (21:27.342)
Yeah, sorry. We've seen also like this cancel culture targeting certain influencers that promote sports betting, maybe legal operators like football journalists or influencers in general. And they've been canceled in social media because of their participation on...

Isadora (21:27.374)
No go hello

Lucía (21:57.742)
On this commercial agreement with sports betting, we've also seen a lot of influencers saying, like, I've been receiving like 100 mails per day to promote gambling. I would never do that. Please be aware. If you're an influencer, stop this. So it's not only a discussion at the Congress level, but also in society. People are taking measures like this, like canceling influencers.

public figures who are promoting sports betting in general. And it's been a discussion also in schools, like most of teachers and personal from schools are saying like teenagers are addicted to their smartphones and also now to sports betting and...

online gaming so yes it's a general debate in the society right now.

Isadora (23:03.046)
And just to make a connection with Brazil, we're facing the same issue right now here, because we have legal platforms being promoted by big influencers, and we have illegal, not just because they're not licensed in Brazil, because none of the operators are licensed in Brazil yet, but platforms that are not licensed at all. They don't have QIC. Like Fer mentioned, they don't have any safety and protection rules and measures in place to...

to prevent miners from accessing. We see miners promoting sports betting in Brazil right now and iGaming. So it's an issue that we share. Like we are Hermanos, so we share a lot of things and that's another thing that we share. But what type of regulations for the industry are lawmakers pushing, if you can give us like an idea of what's happening in Argentina in this matter?

Lucía (23:42.926)
I'm sorry.

Fer (23:56.879)
Well, I think the most important right now is one that's been pushed by a national deputy, which is from the party called the coalition civica, which is pushing for advertising restrictions, which are which wouldn't be allowed in like non targeted advertising. Like if you can't just post or do a poster on the street.

or advertise your company on a massive sports event because that's like non -targeted. It's not specific. With the internet, you can target your marketing efforts to a certain type of audience, like let's say people over 20 years old or people over 18 years old that have an interest in gambling. So with this bill, non -targeted...

advertising would not be allowed and that includes promoting sports betting operations in sporting events, which would be seriously harmful for what has been going on over the last few years with sports betting companies and online gaming companies sponsoring major sports teams like Boca, River,

The actual Argentine league has also signed a deal recently. So this is, I think, the most important one because it's also a nationwide rule. And in the meantime, the same party has also issued a letter to the central bank asking it to order digital wallets to take action in preventing minors from using digital wallets to fund their...

online gaming accounts. So those are, I think, the two most important types of regulations that are being pushed in Argentina right now. Let's, we have to wait and see in Argentina to see what, if this is going to have any type of effect, if these are going to make progress, because Argentina is actually going through a major change in the political aspect, like they are pushing a major.

Fer (26:21.583)
major legislation reforms in Argentina. So I'm not sure this will have the attention that the industry would like or not like. So we'll have to see what happens with the current state of politics in Argentina.

Isadora (26:40.774)
Okay, well we talked about advertisement. What operators are doing right now to advertise their brand's low?

Lucía (26:49.998)
Well, recently we heard about a new deal. Betano from Kaizen Gaming has signed with a major football tournament from Argentina. They signed the deal with AFA, the Association of Argentinian Football, with the Liga Profesional de Fútbol. The name of the tournament is now Torneo Betano.

2 ,024 so they have the naming rights and they are like the major brand of the tournament so it's a big deal here right now with this heat debate also so let's see how people take it.

Isadora (27:37.798)
So before we go, we need your opinion. What do you think will happen in the near future?

Lucía (27:47.086)
Like first said, like we are going through major political changes, a very weak economical activity. So I don't think the industry would take the attention that it would be required for it to be more regulated or yeah, like.

debates are going to another places. So in the near future, I'm not seeing any change. But I do see like people are engaging more in social debates. So I think influencers and public figures and celebrities will be more questioned.

if they participate in sports betting and if they promote it. So I think it will first start at social level and then once the government and the Congress are more established, they will have to take the lead on this. But mostly we will see it on a social level right now.

Fer (29:10.767)
Yeah, I absolutely agree. I absolutely agree because, like I said, the Congress is kind of busy right now, but it will eventually solve everything that's being sorted right now. So maybe next year, this will take the agenda or be more prioritized in the agenda. But I don't see it happening in the next few months, maybe late this year or even next year.

And also regulators need to step up and start enforcing the legislation that's already been, that was already passed. Like only licensed operators are supposed to be operating in the countries that, in the provinces that have their own regulations. So I think the regulators need to start working with the authorities to see how they can prevent illegal operations from working. And like Lou said,

the public opinion targeting influencers and YouTubers and whatnot has had some effect. And I actually have seen some of the of the YouTubers have seen promoting illegal websites adding a little disclosure, which is something I at least saying, OK, this is not valid for Argentina. So if your target audience is mostly Argentina, it's probably not going to have any effect, but at least they are.

seeing that it's not cool to be advertising illegal operations. So I think that's going to play a big role too, like the public opinion pointing their fingers at them and saying, hey, this is not cool. But I think the most important part lies with the authorities which need to step up and start enforcing rules on these operations.