Regulus Partners Puts Permanent Brazil Gambling Ban at 5%

Regulus Partners has estimated only a 5% chance that Brazil's temporary ban on online betting and casino games ultimately becomes permanent.

The consultancy outlined four possible paths for the market following President Luiz Inácio Lula da Silva's September 25 provisional measure. The order already has legal force and covers the operation, intermediation and advertising of fixed-odds betting, including sports betting and online casino games. 

Regulus' 5% figure is an analytical scenario estimate rather than a statistical forecast based on polling. The final outcome will depend on legal proceedings, congressional action and Brazil's presidential election.

Court Challenge Could Stop the Shutdown Early

The first route considered by Regulus is a successful legal challenge before operators are required to take their platforms offline.

The consultancy assigns a 10% probability to the industry succeeding in court early enough to prevent the initial shutdown.

Brazil's provisional measure requires authorised operators to make their betting websites and applications unavailable after a 10-day transition period. New deposits have already been prohibited, while unresolved bets must be refunded if they are still open when access ends. 

Regulus argues that the strength traditionally given to presidential provisional measures makes an immediate court reversal difficult, although operators have begun preparing legal challenges.

Election Result Could Change the Policy Direction

The other scenarios depend partly on Brazil's presidential election, with the first round scheduled for October 4 and a possible runoff on October 25.

Regulus considers scenarios involving either President Lula remaining in office or Senator Flávio Bolsonaro winning the presidency. The consultancy expects the political path to affect whether the provisional measure is maintained, reversed or rejected by Congress.

Current public polling does not establish a clear winner. Recent Datafolha, AtlasIntel and other surveys have shown Lula and Flávio Bolsonaro statistically tied or separated by margins within the polls' stated uncertainty in hypothetical runoff matchups. 

Flávio Bolsonaro has criticised Lula's betting ban, but his position does not imply a return to the previous regulatory framework in full. He has also publicly opposed online casino games, meaning sports betting and casino policy could follow different paths under a future administration.

Regulus Sees Extended Blackout as Main Near-Term Risk

Across most of the scenarios in its analysis, Regulus expects licensed operators to experience a period in which they cannot legally trade while the provisional measure moves through the political and legal process.

The consultancy estimates an 85% chance of a continued market blackout rather than an immediate restoration of the regulated sector. This is separate from its 5% estimate for the ban ultimately becoming permanent.

For operators, the distinction is important. Even if the prohibition is later reversed, a shutdown lasting weeks or months could affect revenue, staffing, supplier contracts, sponsorship agreements and customer retention.

Brazil's regulated market only opened in January 2025, making the current disruption particularly significant for companies that paid for five-year federal licences and invested in local operations.

Black Market Could Benefit From the Disruption

Regulus also expects unlicensed gambling to be one of the potential beneficiaries of a prolonged shutdown.

The consultancy estimates Brazil's wider illegal gambling market at more than $25 billion in revenue when activities including Jogo do Bicho, crypto gambling and illegal gaming machines are included. That figure is Regulus' estimate rather than an official government measurement. 

Brazil has already reported a rapid appearance of new unauthorised gambling domains since the ban was announced, although domain counts alone do not establish how much betting activity has moved from licensed companies to illegal operators.

Regulus also identified state-owned Caixa as a potential beneficiary if restrictions on commercial operators leave the federal lottery with a stronger position in the gambling market.

The consultancy's central assessment is therefore not that Brazil's regulated market will necessarily disappear permanently, but that operators face substantial disruption even under scenarios in which the current prohibition is later removed.