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about one month away from SBC Summit in Lisbon and Portugal's iGaming industry is one of the segments that's gonna be on top of the agenda for one of the biggest events in the industry of gaming and sports betting. Today in a new episode of iGaming Daily in a new edition of the Road to Lisbon series where we interview guest speakers that will advance their insights that they will give during the SBC Summit. We have the pleasure to receive Bernardo Oliveira Neves, Secretary General of Portugal's Online Gambling Trade Association. Bernardo, how are you today? I'm good. Thank you, Fernando. Thank you for the invitation to UNSBC. It's a pleasure to have you on board because you will be actually speaking during SBC Summit on stage one. during day 2 of the conference at a panel named Portugal Smooth Sailing or Danger Ahead that's Wednesday, September 17th from 4.50 in the afternoon local time so anyone that's interested in Portugal not only stay with us in this episode because we will be talking with Bernardo about Portugal's iGaming landscape but you should also be attending the SBC Summit next month and hearing from Bernardo live from the conference room on stage one. And before we jump into the conversation, let's first thank OptiMove, the number one CRM marketing solution for the iGaming market and sponsor of iGaming Daily. Now, Bernardo, let's talk about Portugal. the Portuguese iGaming market, of course, was a major news. because it had a record performance in 2024 but that performance is actually slowing down those record numbers are coming down in 2025 what does this mean for the Portuguese industry? what happened is that we have had consistent growth year on year around 30 % last year actually between 2023 and 2024 it actually accelerated slightly again But as you are mentioning, the results for Q1 show not a decrease, but the deceleration in the revenues. Mostly, the comparison that is not as positive is quarter on quarter, whilst if we look at it from same quarter previous year, it's still a positive growth. And for now, because we only have one quarter's worth of data for 2025, it's still early to take any conclusions. We can even say, that it could be a result from the actual surprising acceleration from Q4 24. That as we all know, and anyone who's managing businesses in this space, that sometimes when you have a really bad performance in one quarter, really good on another, it can balance out in the quarters that follow it. as I said, still early to know. So for now, we're not drawing any major conclusions. The only sticking point I would also say is that the market is entering its 10th year. So in terms of legislation, 2025 marks the 10th year anniversary of the publication of the RGO, which is the law that governs online gambling in Portugal. Next year, it will be the 10th anniversary of the first operators to be launched, which were just around the year 2016 of happy memories for the Portuguese in general, not just the gambling industry. And so there is some maturity naturally that will be setting in, namely if the market doesn't progress as well in some areas of product, which I'm sure we'll address further on. Yes. Speaking of specific areas, following these results, what trends do you think the industry should be observing in Portugal in general? Well, what we are expecting in truth is that if there are no major developments in terms of product, that the market will continue to grow, but there will be some deceleration as we go on. So the rates, as I said, year on year, were very close to 30%. Last year against 2023, it was actually higher than that. It was around 31%. So that's definitely something that could be expected. I would also expect a continuous sliding of the scale in favor of iGaming in terms of the casino products in Portugal. Although I think the biggest progress on that since has already happened. Again, future product developments notwithstanding. But other than that, clearly see, and this is something important that I can give as a perspective of Portugal, that if we look back prior to the launch of the regulated iGaming environment in Portugal, the same growth rate for the whole gambling industry in Portugal has maintained. What has happened that was very significant and different from the introduction of the online gambling regulation is that the consumer migrated from the land-based products into the online products. One thing that is a clear indication, and I think everyone will have this resonate with them regardless of market, is that the previous incumbents of the lotto industry and the casino land-based industry, they haven't gone back to the pre-COVID-19 figures. Whilst as we discussed online has been growing significantly. So I think that trend will also continue to grow. The main concern naturally, and I think this is applied to elsewhere in Europe as well, is the comparison with the illegal market, which is the biggest threat, both to the business, but also to the consumer and the state in general. Let's jump straight into the illegal market. How do you assess the Portuguese government's actions against illegal operations, which is a big challenge and a big threat for the regulated gaming industry, not only in Portugal, but everywhere else in the world. But since we have you here, let's talk about Portugal. Yes. So let's start with the data that we actually have, right? Because one of the biggest challenges for the markets across Europe and the world is the actual identification of the size of the business. Right? So it's very complicated to assess what is the actual size of an illegal business. But what we know is the consumer preference. That part we have conducted studies year after year for a few years now, and they show consistent results whereby 40 % or more of Portuguese consumers are gambling in illegal websites. It's important to mention that most of these people are gambling also on legal environment. Okay? So there's around the 60 % exclusive market of people playing only on legal websites with a license and about 40 % gambling on illegal operators that don't have a license, but also most of them gambling on licensed operators. That is easily explained by some other data, namely the fact that we can see confusion on the consumer. Only about a third of the consumers in Portugal that gamble on illegal websites actually seem to know that they're gambling on illegal websites. And in terms of addressing your question more directly, the Portuguese state is doing, I would say, the basics. So they are conducting what they promised in terms of legislation of doing some URL blocking, which we already know is ineffective, but also indispensable. one thing doesn't nullify the other. So they are doing that. they're raising cases before the public prosecutors. But what they're definitely not addressing, at least successfully so far, is the payment side of things. So there are Portuguese payment methods that exclusive Portuguese payment methods that are owned by Portuguese banks and that are being used to credit the illegal platforms. And I would say that is the biggest black spot in terms of what has been done so far. The main problem there, I would say, is that there lacks a clear direction on the political side of which should be the agencies actually involved on combating and having the last responsibility on this topic. So we have been working a lot on this for the last two years. We have been talking to all of the stakeholders and we were kind of tightening the topic bit by bit. until hopefully there is some admission that either there was actually a responsibility all along lying somewhere that is not assuming that same responsibility or that the political sphere actually admits that some further regulation is required in order not only to make responsible but also to empower the correct agencies to intervene where needed. well, we kind of already have a sense of what the government needs to do. to safeguard the regulated market given this last bit of your answer there. let me expand a little bit on the question and say most Western countries, Western European countries, mean, have updated and have modified substantially their regulation. And Portugal has been a little bit more conservative, let's say, and it has maintained its original framework from the original online gaming regulation. Why do you think the country has remained so reluctant to implement further regulatory revisions? And again, what areas do they need to update to continue to safeguard the regulated market? I think you phrased it very properly, Fernando. So the Portuguese regulator and legislator has in fact been very conservative for good and bad. so one of the things we haven't noticed yet. is an impulsive political approach to restricting the market. that has not happened here yet. Each time there is an impulse for restriction, we can see that in fact this is being studied and looked at. I'm not going to say in depth, but at least it's not being made lightly. OK, so that's a positive. But there's the negative, which is that both on product, but also on responsibility related to illegal gambling, things haven't moved. The why, I believe, is related to what type of political subject online gambling is. So for the most part, politicians, I believe, look at this as a topic that has more power to do them harm than good. And namely, if they're going to take a very structured, constructive, rational approach, it might not be understood by the people who are actually benefiting from that approach. And so they tend either to do nothing or what we see elsewhere in Europe sometimes is that some more specific political groups in specific parties or within broader parties take action, but mostly looking at restrictions a lot of times because it's something they believe will result in an easy political game. So our expectation is that sometime... maybe in the next 12 months, there will actually be some movement in terms of regulation. This could happen specifically for restriction, has it happened elsewhere, but definitely the industry will be doing its best to make sure not only that any restriction that is applied is actually to the benefit of the consumer in particular and to the broader society. And also, that all of the, if we're touching the law, that any of the other increments which are necessary to make the market evolve actually are also happening. You have given our listeners a lot to think about on the regulatory landscape in Portugal. So let's give them a quick break to go get a glass of water and we'll be right back with iGaming Daily after this quick commercial break. and we are back with iGamingDaily in another episode of the Road to Lisbon series with Bernardo Oliveira Neves, Secretary General of the Portugal Online Gambling Trade Association Bernardo, thank you very much for joining us, we were talking about regulation before the break and of course in Europe if I think of regulation I immediately think of Spain and Italy which are very strong examples of restrictive regulation and especially related to advertising. So as the segment grows in Portugal like we've seen last year with the record figures and of course Portugal also updating its advertising regulation the question is what does the industry from within need to do to avoid prohibitive measures coming from the government? Well, that's a very good question. I would say that one thing that everybody in any market could learn is that while the industry holds, and I believe this is to be true in every market, the industry holds the better and more profound and more nuanced knowledge of everything that surrounds this phenomenon of gambling. In several cases, either potentially the industry didn't act swiftly enough to show all of the knowledge that it had in order to improve the conditions for all of the stakeholders involved. Or it did, but it was denied the possibility to actually have any impact by the other stakeholders involved. So what I would say that is important is precisely that that knowledge is leveraged in Portugal, that we are the proponents are the main proponents of what could be the future advancements in the market. There are several things which already have been discussed within APAJO and we are definitely going to discuss even more. And our expectation will be that if the discussion for a review of the regulation is deployed, that we will be ready to address it and to be significant contributors. to what is actually going to happen. These will include probably propositions on every area. So on the consumer protection, on the product development, on some operational topics that were created that they just need to be better adjusted to the practical realities of the industry. And we do that on ongoing basis with things that are not even related to legislation. Just to give you an example, one of the most recent examples, Apache has proposed to the Portuguese regulator an improvement on the self-exclusion system. So most of the self-exclusion that are applied in Portugal are applied within the operator. there is a, and again, this is not something specific to Portugal, but there is a self-exclusion system that is per operator and a cross operator system. The cross operator sits only on the website of the Portuguese regulator, while the per operator naturally sits within the platforms of each operator. And as we know, only a residual amount of self exclusions are applied across operators, which is naturally something we intend to improve upon. So we delivered a proposition that intends to leverage the traffic of the operators themselves and create an easier path into the conversion of a self-exclusion player in an operator into a cross-operator self-exclusion. What we already spoke about in terms of the fight against illegal gambling could have us here talking all day about new measures, but I can also tell you that even in terms of the features and how they operate within the product are things that needs adjustment so we can have a competitive offer to the consumer. of course, beyond advertising, illegal operations, taxation is one of the topics that concern the gambling operators the most. And in 2020, tax reforms on online casino and sports betting were initially criticized by international operators, but then they weren't aligned with the broader European standards. do you think Portugal has become a more commercially viable market for international operators? I'll talk first about what was the baseline, right? So the baseline we had was a taxation that was based on turnover for support sweating and based on GGR for casino and both were progressive. So the more you have of volume, the more you have of turnover on sports, you would pay a higher rate. And the more you have of revenues in terms of casino, you would pay a higher rate. The only change that happened in the taxation so far came to adjust that progressive element, which obviously was problematic in particular in regards to the sports book taxation. Right now, what we believe is that definitely there is room for improvement, but it's more nuanced than a lot of times is expected. We understand the position of some international operators that look at Portugal and they would love for the taxation to just move for at least on a sports book into a GGR base. And in concept, we can understand and follow. but we are looking at it on a more detailed and systematic perspective because obviously all of these things work in an equilibrium, right? And so right now, there is, as you said, there is a conservative approach from the regulation and legislation, but when things change, we need to understand that it's more hard to conceive that they'll happen in pockets, right? That there will be a change in taxation, without a review of other elements. And there's even the possibility that we know of looking at other markets, that if there is a review, it can actually worsen conditions in comparison to improve them. So it's something on our radar, but it's something that we look at with a significant amount of detail. Regarding the viability, I believe that the market has shown itself to be viable at least for the most significant operators. I'm not going to draw comparisons with other markets, although I would say that definitely we were in one of those situations where we're not the best nor the worst on either of the chapters. Although definitely I would put us on a better position in terms of what is the taxation on casino. and on a worse position if we're comparing in regards to the sportsbook taxation. Bernardo, we could have you here all day talking about this, but unfortunately we're out of time. Luckily for us and for everyone in the gaming industry, you will be speaking at the Portugal Smooth Sailing or Danger Ahead. That's a panel on stage one during Wednesday, September the 17th. That's day two of the conference at SBC Summit. That's again, Wednesday, September 17th. at 4.50 in the afternoon on stage one. That's Bernardo Oliveira Neves from Apejo, Portugal's online gambling trade association, who will be moderating that panel. So Bernardo, to close up the episode, where do you see the industry going in the future in Portugal? Well, my hope is that Portugal could actually be a flag bearer for the industry across Europe. Obviously, we'll need all of the stakeholders to pull together to make that happen. But we at least have that hope that if there is a positive, constructive discussions with everybody on a good standing, that we can actually make Portugal an example of what can be achieved with the right balance for all of the involved parties. We'll naturally be discussing that with the political, with our political counterparts, with our regulation counterparts. And hopefully this will continue to be a very Welcoming market in particular for the consumer which I believe is the main concern of all involved parties Bernardo, thank you very much for your time We will see you then in SPC Summit. Thank you. See you there