Brazil’s betting ban raises sports integrity red flags

One of the world’s largest sports integrity organisations has protested that the ban on online betting being rolled out in Brazil will have disastrous consequences for sport in the country.

The International Betting Integrity Association (IBIA) has published a report into the economic and societal impacts it believes President Lula da Silva’s shock online betting ban will have.

The association, which consists largely of betting operators, argues that Brazilian sports teams will lose valuable integrity monitoring as a result of Lula’s ban. This is due to the fact that the organisation and others expect the bulk of betting in Brazil to go offshore.

It has been widely argued in the weeks since Lula announced the ban on 25 September that the move will simply prompt Brazilian bettors to wager with offshore firms. The IBIA projects that around 60% of Brazilian betting spend, around R$25bn (£3.7m), will head this way.

SBC Noticias Brasil reported that illegal iGaming operators rose from 331-575 in the first 24 hours after Lula’s announcement. 

This in turn will mean the IBIA will not be able to carry out its monitoring of the now-banned regulated betting market. In 2025, the first year of regulated betting in Brazil, the IBIA flagged 25 suspicious alerts in Brazilian sport, including 19 in football and five in basketball.

The IBIA is not alone in making this case. Speaking at the SBC Summit in Lisbon last month, Emanuel Macedo de Medeiros, Chief Executive Officer of the Sport Integrity Global Alliance (SIGA), remarked that “dismantling the regulated market is not the answer”.

“No industry deserves to set its own rules, but the state must act responsibly with evidence and proportionality, and a credible transition,” he added. “This is not what we have witnessed.”

Going further, the IBIA argues that Brazilian law enforcement and regulators will also lose out should betting be banned entirely. The association notes that authorities will no longer be able to access market data and customer account trails which can help with investigations into illicit betting and match fixing.

Talking numbers

Outside of integrity, the IBIA has pointed to one other way in which Brazilian sports organisations will lose out – sponsorship revenue. Partnerships between football clubs and operators in Brazil have become particularly prevalent since the market launched on 1 January 2025.

Of the 20 clubs in the top-flight Brasilero Serie A, 14 have an active deal with a betting company. Some even struck partnerships in advance of the market launch, with deals including valuable front-of-shirt arrangements, such as Betano and Flamengo.

According to Galapagos Capital, an investment company, sponsorship revenue accounts for 24% of clubs’ commercial revenue in 2025. It’s fair to say that Brazilian football’s finances will be hard hit by the betting ban in the long-run.

Something that makes the ban even more surprising, however, is the fact that the government is also going to lose out on revenue. Gross gambling revenue (GGR) was being taxed at a rate of 13% at the time of Lula’s ban, and was set to rise to 18% by 2028.

In H1 2025, more than R$8.7bn (£1.2bn) in betting taxes was declared. By banning the market, which he himself reluctantly gave the greenlight to back in December 2024, Lula is cutting his government off from this lucrative revenue stream.

The time is tight for both Brazilian bookmakers and the football clubs which have established such a solid financial pipeline to them. All regulated betting has effectively ended, as an injunction won by Stake which allowed the firm to continue operating until 25 October shut down earlier this week.

The deciding factor will be the election run-off taking place on 25 October. While opposition presidential candidate Flavio Bolsonaro had previously mulled up a betting ban himself, he has since slammed Lula’s move as a political play, suggesting he may be open to the industry coming back in some form.