Stake to Challenge Suspension of Injunction Against Brazil Betting Ban

Stake will pursue further legal action after a Brazilian court overturned a preliminary injunction that had allowed the operator to continue operations despite President Luiz Inácio Lula da Silva’s ban on licensed betting.

The injunction had granted Stake the right to resume until 25 October. The next day, Judge Luis Antonio Johonsom di Salvo, president of the Federal Regional Court of the 3rd Region, suspended it following a request from the Attorney General’s Office. The AGU argued the ruling gave Stake an unfair competitive advantage over other operators that remained banned.

Stake’s case is handled by Bichara e Motta Advogados. Partner Udo Seckelmann confirms the operator will challenge the suspension, as first reported by iGaming Business. “Of course, this is not over,” Seckelmann says. “This is just one setback that happened. We are drawing up some strategies to overturn this. We’re going to challenge this decision for sure. We have two possible strategies. We’re analysing which one would be best to file.”

Arguments Centered on Investments and Legal Certainty

Operators had met strict market entry requirements after the regulated market launched on 1 January 2025. These included a BRL30 million ($6 million) licence fee, a BRL5 million financial reserve, and a Brazil headquarters mandate for international firms such as Stake. Seckelmann argues the abrupt ban before the two-year mark of five-year licences undermines the legal certainty on which those payments were made.

He also questions the ban’s foundation. The provisional measure cited addiction and family debt concerns, yet Seckelmann states these problems stemmed from illegal gambling rather than the licensed sector. The reversal, he suggests, reflects a political choice: the Attorney General’s Office targeted a judge known to favor the federal government, resulting in a ruling that cited general principles without detailed analysis.

Risks of Delay and Industry Precedent

A partial survey by the National Association of Games and Lotteries shows over 3,500 workers have already been laid off since the ban took effect. Seckelmann warns that prolonged uncertainty will cause irreversible damage, as operators terminate contracts and sustain mounting losses while awaiting a Supreme Federal Court ruling on constitutionality. That decision is not expected until after the second round of elections on 25 October.

The outcome carries weight beyond Stake. “If we get a positive decision in the next couple of days, maybe other operators will get that too,” Seckelmann adds. “So we know the degree of responsibility that we have for the whole industry.” A successful challenge could preserve positions for licensed firms and reinforce expectations of regulatory stability in the jurisdiction.

Reporting: iGaming Business (iGB)

Generated by SCCG’s automated editorial system from published source reporting. SCCG Management holds editorial responsibility.