By Damian Martinez, journalist at G&M News.
What’s your evaluation on the recent iGaming and sports betting regulation in Brazil?
There has been significant progress towards market regulation in Brazil within the last 24 months. After years of deliberations, the law now covers both online sports betting and casinos, two very popular verticals. This development underlines the attention of many stakeholders, particularly the Government, seeking to establish well-regulated frameworks. Such frameworks have proven beneficial in other jurisdictions, leading to greater player engagement, as players move to their countries and tax revenues can be allocated to priority projects. Brazilian law reflects the commitment of jurisdictions to strengthen the protection of players. Specifically, the law obliges operators to implement effective monitoring systems to identify potentially problematic behavior or gaming patterns among players. This represents a significant positive aspect. I believe that the spirit of the law is not focused on strict regulation or prohibition, but rather seeks balance. For example, the ban on playing on credit serves to safeguard players from potential financial harm, while bonuses and promotions are not intended to be banned across the board. Although the law reduced the gambling tax, there are other taxes related to gambling, such as the tax on players’ earnings. Even if this is set at 15%, it could ultimately impact on players’ profits. Furthermore, in a newly regulated market, advertising is important to inform the Brazilian consumer about gambling and legal operators. Finally, in a newly regulated market, with local licensed operators serving Brazilian players, effective law enforcement against illegal offers will be important for the business.
Chile and Peru are also moving towards regulating online sports betting, but at a somewhat slower pace. What are the main obstacles that exist in both markets?
Peru has just opened the period for granting licenses, and several interested parties in the sector have already submitted their applications. The requirements have been in the public domain for a few months, so those interested in the Peruvian market have plenty of time to delve into them and understand them. Peru established a schedule for the launch of the market, and it seems that it is going to meet it. Players will soon find all the popular verticals in the legal market, and Peruvian authorities should reap the benefits of a well-regulated market. Chile is moving forward at a steady pace with the gambling bill, which has passed to the Senate. Although progressing at a slower pace, the focus remains on creating a well-crafted Gambling Law that serves the interests of all stakeholders. Taxation remains a central topic of debate, and it is crucial that authorities fully consider the overall fiscal impact on operators obtaining an online gaming license in the once regulated market. Additionally, other provisions are important because consumers compare prices, want to choose between the most popular online verticals, and want value. Once regulated, Chile could see benefits, such as raising tax revenue and greater protection for players. As regulation of the Peruvian market takes shape this year, there are high expectations that it will successfully achieve its regulatory objectives. That could further inspire Chile, which would follow in the footsteps of other Latin American markets such as Colombia and Argentina. It is worth noting that 76% of those surveyed in our ‘Responsible Gaming in Latin America’ report believe that the Government should regulate the betting market.
What advice would you give to operators wishing to enter the different Latin American markets?
In Latin America, other jurisdictions will follow the path of regulation and open their respective markets, similar to what happened in Europe. No country is the same; each has its own characteristics that can lead to the individual nuances that jurisdictions often add to their regulations, even when taking from the tried and tested. Likewise, player behavior differs from country to country and content selection must therefore be adapted accordingly. It is essential to adapt the content to the different profiles of the players. This includes offerings such as casino games, slots, and the increasingly popular live dealer entertainment. Typically, in a newly regulated market, the focus is primarily on players already involved in offshore gambling, mainly due to the absence of a legal alternative. Consumer perceptions from our reports on ‘Responsible Gaming in Latin America,’ both conducted by Toluna, show that the younger age group is especially attentive to the availability of tools that help keep gambling under control and detect possible risk behaviors, as much as players like to bet on entertainment and not just sports betting, for example. In my previous mention of Europe, I highlighted the increase and the political pressure on the gaming sector. This has led to a wave of restrictive measures that are being applied across European markets. As an industry, we may have collectively fallen short in proactively raising standards of responsible gaming. However, there has been notable development in Colombia’s mature online gaming market, with revised regulations now placing greater emphasis on player protection.
Do you think Latin American regulators and operators should increase their measures and activities to prioritize player protection?
Each regulated market should implement robust and efficient measures to safeguard players, aligned with its regulatory objectives, with new markets having the opportunity to take advantage of this from the beginning. Ensuring responsible gaming practices must be a shared responsibility between regulatory authorities and industry stakeholders. Operators have access to highly detailed data on each player’s behavior, which can be used to detect early signs of problem gambling. Technology and tools now make it possible to monitor players, leveraging predictive behavioral analysis to detect excessive betting or prolonged online play. In particular, Buenos Aires (Argentina), Colombia and the new legislation in Brazil have already adopted these practices. Our report on ‘Responsible Gaming in Latin America’ provided information on how players in their respective countries view responsible gaming tools and also their preference for receiving alerts. For instance, 38% of Latin Americans mentioned pop-ups as their preferred option for receiving responsible gaming notifications while playing online, especially in Peru (45%), Colombia (43%) and Chile (42%). Furthermore, according to our Responsible Gaming report, on average, 1 in 3 people (33%) in Latin America have received a warning about their level of gambling, while 67% have indicated that they have not received such a message. The country where the most respondents have received this warning is Brazil (52%), followed by Peru (37%), Colombia (31%), Chile (28%) and Argentina (16%).