Brazil’s gambling industry in turmoil after Lula re-elected
Brazil’s gambling industry faces continued regulatory uncertainty after President Luiz Inácio Lula da Silva secured re-election, extending the political dispute surrounding the country’s prohibition on online sports betting and casino gaming.
Lula won Sunday’s presidential runoff with 51.79% of valid votes, defeating Flávio Bolsonaro, who received 48.21%, according to official results released by Brazil’s Superior Electoral Court.
The result comes just one month after Lula’s government introduced Provisional Measure 1,394, which suspended the country’s recently established regulated online gambling market.
Operators that invested heavily in licences, technology and local operations are now waiting for Brazil’s Supreme Federal Court and National Congress to determine whether the prohibition will remain in force.
The election result does not itself resolve those legal proceedings.
Industry representatives have argued that the prohibition undermines investments made after Brazil introduced its regulated gambling framework in January 2025.
One of the companies most exposed to the changes is Flutter Entertainment, which suspended its Brazilian operations following the September prohibition.
Flutter previously warned that an extended shutdown could reduce its 2026 revenue by approximately $70 million and adjusted EBITDA by $20 million.
The company had invested heavily in Brazil, including acquiring a 56% stake in NSX in 2025, bringing the Betnacional business together with its existing Betfair operations.
The company has previously indicated that it is reviewing its options, including a potential legal appeal.
Meanwhile, gambling groups have challenged the prohibition in Brazil’s Supreme Federal Court, arguing that licensed operators should be permitted to resume operations while the legality of the measure is determined.
The government has defended its intervention as a measure intended to protect indebted households and reduce gambling-related harm.
Industry groups dispute the effectiveness of a blanket prohibition, warning that customers may instead migrate to unauthorised offshore betting websites.
Research published following the September shutdown indicated increased visibility of illegal gambling websites and rising search interest in offshore operators.
However, those figures do not establish how much gambling expenditure has actually moved outside the regulated market.
The Supreme Federal Court and Congress now represent the two principal avenues through which the prohibition could be overturned or amended.
Congress is examining the provisional measure, while legal challenges question whether the government can prohibit activities previously authorised under Brazil’s gambling legislation.
