Latest ordinance in Brazil gives green light to online games

The highly anticipated Normative Ordinance No 1,207 was published in Brazil’s Official Gazette of the Union, on Wednesday 31 July, providing clear technical requirements for those seeking an online betting licence.

Less than three weeks remain until the initial 90-day window of preference for betting licence applications closes, though only five have been submitted to date. But an influx of interest is expected now online gaming rules have been confirmed.

Aposta Ganha CCO Hugo Baungartner expects this latest ordinance to be the catalyst for the majority of operators to apply.

The Prizes and Betting Secretariat (SPA) has been publishing regulations since April, when a four-phase rollout was announced for the end of July.

Among the regulations already announced was the banning of the use of credit cards and cryptocurrency for wagering, as well as a 15% tax on player winnings over BRL2,824 (£437.77/€508.05/$547.25).

In addition to the latest ordinance, new rules on marketing, government contributions and responsible gambling have also been published this week.

Which games will be allowed in Brazil?

Digging into the details of Normative Ordinance No 1,207, online slots and card games like blackjack and poker will be permitted in the licensed betting market, alongside roulette.

Crash games will also be legal in Brazil, though they must be random and not give out prizes based on a player’s skill. The maximum and minimum values of the prize multiplier must be clearly displayed, as well as the frequency with which it increases.

The ordinance states each game should pay players a minimum RTP of 85%, with the advertised top prize being won at least once in 100 million players.

Notably, the controversial Fortune Tiger game will also be allowed in the market despite influencers recently being arrested in Brazil for promoting the game to their followers. The game is hugely popular in the market due to questionable affiliate programmes spamming social media users with ads.

Despite few bad players in the sectors, Thiago Balieiro, vice-president of people and performance in the Americas for local lottery platform Sorte Online, recently told iGB the majority of local operators already deployed sophisticated know your customer (KYC) and prevention tools.

“We have some institutional challenges and I think this is common ground for all the companies in the market to make sure the Brazil population understands that although we are an entertainment industry, we pay very good attention to anti-money laundering programmes,” Balieiro told iGB.

“We pay very good attention to know your customer and prevention of addiction to gaming. There are a lot of structures and I think the regulation is really focusing on this to avoid all the problems that gaming addiction can cause in the population.”

Game providers must seek official SPA certification

B2B online games and live gaming studios must be certified by an SPA recognised entity and maintain valid certificates while operating. Those certificates will need revalidation should “critical components” be changed.

Operators utilising a third-party gaming platform must present a certificate of integration between the two systems.

The ordinance states the outcome of online games must be determined by a random future event with a random generator of numbers, symbols, figures or other objects.

Operators must also present a payout table, showing all of the potential winning possibilities, to players before they bet.

Online gaming session requirements

Online gaming platforms must inform players of all the game options available. Such payout tables should not “misleading or unfair”, showing potential prizes in a clear manner.

Bettors shouldn’t be forced to bet even if they’ve selected a game and default game screens mustn’t show the highest advertised prize unless it relates directly to the last game played.

As for live casino, the regulation states studios should have a designated location with sufficient physical security controls to ensure only authorised personnel have access.

Providers must operate surveillance systems with “continuous and unobstructed” views of all live games.

All online games must be recorded to confirm rules and procedures were adhered to, with the footage available for review from either the betting agent or the SPA should a complaint be raised. Such footage should be kept for at least 90 days after games have taken place.

On Friday (2 August), iGB will bring you a round-up of four other ordinances that have been published in Brazil this week.