Brazilian Industry Bodies Back Government Decree Targeting Illegal Betting

President Lula signed Decree 13,033/2026 on Friday, introducing measures to combat illegal betting and bolster Brazil’s regulated market. The decree and accompanying Ordinance No 1,766/2026 focus on blocking funds linked to unlicensed operations and establishing joint liability for financial institutions, payment companies, and advertisers in tax collection for irregular fixed-odds betting.

Industry groups have voiced strong support. Both the ANJL and IBJR see the steps as advancing consumer protection, tax compliance, and fair competition. The moves arrive against a backdrop of significant illegal market activity that continues to challenge licensed operators.

Scale of the Illegal Market Challenge

Data from the minister of justice, Wellington César Lima, indicates that 25.2 million Brazilians bet on illegal websites. For Plínio Lemos Jorge, president of the ANJL, this figure underscores the size of the problem and validates the need for stronger inspection.

The illegal betting industry exposes consumers to risks, evades taxes, and creates unfair competition for compliant companies. Lemos Jorge noted that the announced actions represent an important step in strengthening the regulated market.

The advances are the result of an environment of dialogue and institutional cooperation that allowed regulators and the sector to gather information, develop tools, and better understand illegal operators’ activities.

According to the ANJL, the Secretariat of Prizes and Bets has played a key role in consolidating regulation and building more efficient mechanisms against clandestine operators. The new decree enhances the state’s ability to target not only operators but also supporting structures for dissemination and financial backing.

IBJR Highlights Revenue and Bettor Safety Impacts

The IBJR expressed support for the federal government, the ministry of finance, and the ministry of justice. It welcomed the publication of Decree No 13,033/2026 and Ordinance No 1,766/2026 as tools to weaken illegal operations.

Research by the Locomotiva Institute with LCA estimates the illegal market moves approximately BRL40 billion ($7.7 billion) annually. Carlos Lima, president of the IBJR, said this causes an estimated loss of BRL10.8 billion per year to public coffers.

These are resources that are no longer invested in priority areas for society. Initiatives like this represent a crucial step forward in the fight against illegality.

The measures strengthen public revenue while increasing bettor safety and protecting compliant operators. They also promote the integrity and sustainability of a sector governed by one of the world’s most modern regulatory frameworks.

Risks and Limitations in a Dynamic Environment

Lemos Jorge emphasized that combatting the illegal betting market is a constant challenge. The clandestine industry operates with a high degree of technological sophistication and adapts very quickly.

This prevents any definitive assessment of the measures’ effectiveness. What works today may cease to be effective tomorrow. Therefore, this fight needs to be continuous, coordinated, and dynamic.

From an operator perspective, joint liability rules introduce new compliance obligations for banks, processors, and advertisers. While these may reduce illegal volume over time, rapid adaptation by unlicensed sites could limit near-term impact on licensed market share.

Tax exposure for licensed operators could improve if enforcement successfully redirects activity. Yet the speed of illegal market innovation suggests market consolidation timelines may stretch longer than initial optimism anticipates. Sustained coordination between the SPA, regulators, and the regulated sector will prove decisive.

The Bottom Line

Decree 13,033/2026 and the joint liability framework signal a clear federal push to level the playing field in Brazil. By targeting funding channels and supporting structures, the government aims to convert a portion of the $7.7 billion illegal market into regulated volume that generates the BRL10.8 billion in annual public revenue now lost.

Success will hinge on execution and adaptability. Operators and associations must maintain the dialogue that produced these tools while preparing for the next evolution of illegal offerings. Those positioned with robust compliance infrastructure stand to benefit as enforcement gains traction.

As the regulated market matures, client-partners navigating Brazil’s licensing and operational requirements should monitor enforcement outcomes closely. This inflection point could accelerate consolidation among compliant operators. For tailored advisory on Brazil market entry and regulatory strategy, visit our LATAM advisory page.