The Communications Committee of the Brazilian House of Representatives approved Act No. 4044/2025, which re-establishes the fight against illegal gambling as a centrepiece of the national legislative agenda. The bill, which was introduced by Federal Representative Paul Bilinsky (PL-SP), seeks to consolidate the legal market order by comprehensively curbing unauthorized lottery activities through financial, technical and legal means.
The bill will strengthen the legal ecology under the supervision of the Brazilian SPA (Search and Lottery Secretariat), ensure that licensed operators operate in a safer and stable environment and clearly delineate the boundaries between legal and illegal markets. The Act defines “unauthorized operator” as any person or entity that provides lottery services without the approval of the Ministry of Finance, and empowers the authorities to hold relevant intermediaries, promotions, payment agencies and other persons supporting the illegal operation. The bill emphasizes financial repression, requiring banks, financial technology companies, card issuers and payment service providers, among others, to establish monitoring and filtering systems to identify and block financial flows associated with illegal gambling. The above institutions are required to report on a monthly basis on preventive measures and stopped transactions. Violations are punishable by a maximum fine of R$20 million and serious offences are suspended. As a priority regulatory area, Internet service providers and telecommunication operators are required to cooperate with the embargo on illegal lottery-related domain names, including IP closures, DNS interception and restricted access to virtual networks. At the same time, legal operators are required to provide a clear operational boundary between compliance and illegal operators by using geo-location systems to prevent access from unauthorized areas.
In addition, the Act covers services that indirectly support illegal gambling, including marketing agencies, software providers, legal advisers, cyber-red, etc., who are found to be responsible for assisting in illegal gambling. The exemption is limited to services necessary to obtain an official permit. Brazil ‘ s online gaming market has developed rapidly after legalization, but there has been a synchronous proliferation of illegal websites, mostly in jurisdictions with low legal cooperation, where tax evasion, the risk of money-laundering and fraud pose a threat to consumer security. According to legislators, the new legislation would significantly increase the cost of illegal operations and safeguard market equity and consumer rights. However, the bill is still to be submitted to the plenary session and to the Senate for a vote, through the Finance Committee and the Constitutional and Judicial Committee. The key challenge for the future is to ensure that the State has sufficient technical and enforcement capacity to balance strict enforcement with the maintenance of industry competitiveness.