Brazil's government has asked its Supreme Court to invalidate the laws that created the country's licensed betting market, marking a dramatic reversal from its earlier defense of the framework. The Attorney General's Office filed the challenge on October 2, as licensed betting sites prepare to shut down on October 6 pending a Supreme Court ruling on industry requests to suspend the ban.
The government's filing seeks to void the 2018 law that legalized fixed-odds betting and most of the 2023 law that regulated it. In justifying the move, government lawyers cited a roughly 140% rise in public health system visits recorded under gambling-disorder codes between January 2018 and December 2025, while acknowledging the figure does not track individual patients and cannot be entirely attributed to online sports betting. The filing also referenced record household debt levels and concerns about criminal factions using betting platforms for money laundering.
President Luiz Inácio Lula da Silva issued a provisional measure banning online betting on September 25, nine days before the country's presidential election. The shutdown gives players until 11:59 p.m. Brasília time on October 5 to withdraw their balances. The central bank has already prohibited Pix payments for fixed-odds betting, along with bank transfers and boletos, though cryptocurrency transactions remain unregulated.
The move has prompted urgent legal action from the industry. The National Association of Games and Lotteries and the Brazilian Institute for Responsible Gaming asked Justice Luiz Fux to rule before the shutdown deadline, citing that 83 companies paid 2.55 billion reais ($488 million) for five-year licenses that would be extinguished without refunds. Football club Flamengo, whose shirt sponsorship is worth approximately 268.5 million reais ($51 million) annually, filed its own urgent request, joined by at least 22 other clubs. On October 2, Justice Fux gave the government 72 hours to respond to the industry appeals.
