Lula's online betting ban in Brazil rattles global bookmakers
President Lula's surprise prohibition of regulated online betting has drawn sharp criticism from Flutter Entertainment, Entain and Allwyn, which warn of lost tax revenue, jobs and legal fallout, according to SBC News.
Brazil's president, Luiz Inácio Lula da Silva, moved on Friday to outlaw online betting nationwide, a decision that operators say will reverberate well beyond South America's largest economy, SBC News reports.
The country's regulated market had expanded rapidly since legalisation two years ago. The Blask Index put its baseline earnings at $9.5bn, while operators declared more than R$8.7bn (£1.2bn) in betting taxes during the first half of 2026 alone, according to SBC News.
Major international names built substantial businesses there, including Flutter Entertainment, Betano, Superbet and bet365, alongside suppliers such as Playtech, Kambi and Evolution.
Flutter's chief financial officer, Rob Coldrake, had recently pointed to what he called "huge growth opportunities" in Brazil. Lula, long a sceptic of the sector, has now removed that prospect at a stroke, SBC News notes.
Flutter warns of a shift to unlicensed sites
A Flutter spokesperson said the group greeted the news with "surprise and great concern", calling it a step that could represent "the prohibition or dismantling of an activity authorised and regulated by the Brazilian State itself".
The spokesperson added that Brazil had chosen to regulate the market by putting rules, licences and oversight in place, and that firms such as Flutter Brazil had invested, paid licensing fees and generated jobs on that basis while paying tax under state supervision.
Flutter warned that consumer demand for betting will not disappear simply because authorised platforms are removed, and that a ban risks pushing bettors toward unlicensed sites lacking safeguards such as identification checks, deposit limits, transaction monitoring, self-exclusion tools and anti-money laundering controls.
Flutter entered the Brazilian market through its acquisition of NSX, operator of the Betnacional brand, in May 2025. The resulting Flutter Brazil division generated revenue of $74m (£55.7m) in the first half of 2026, up 722% year-on-year, a segment now under direct threat as the company navigates a leadership transition and a steep year-to-date fall in its share price.
Flutter's own estimates suggest the unlicensed market's share of Brazilian betting activity had already been shrinking under regulation, moving from a range of 41 to 51 per cent in 2025, the first year of legal operation, down to between 38 and 44 per cent this year.
The company also forecasts wide-reaching economic damage, including potential tax losses of between R$58bn and R$73bn from 2027 to 2030, roughly 15,000 direct and indirect jobs at risk, and around R$3bn in media advertising spend from the country's 15 largest betting firms left in jeopardy.
Flutter further noted that 18 of the 20 clubs in Brazil's top-flight Série A held betting sponsorships worth R$1.1bn in 2025, while fixed-odds betting contributed R$1.6bn to Brazilian sport, including Olympic and Paralympic disciplines, in the same year.
Its spokesperson argued that protecting the public is better served by strengthening oversight, responsible gambling measures and enforcement against illegal operators than by dismantling the regulated market altogether.
Entain expects the lower end of its guidance
Entain, which had highlighted strong momentum for its Sportingbet brand — ranked fourth in Brazil by online traffic according to Blask — said it now expects the market to contribute around 5% of group online net gaming revenue for the 2026 financial year, though EBITDA from the region will be modest given what it described as a challenging and highly competitive operating environment.
The London-listed group still expects overall revenue and online underlying EBITDA margin to land within previously guided ranges of £910m-£960m and 21-22% respectively, but now anticipates results toward the lower end because of the Brazilian disruption, alongside online NGR growth of 4-6% assuming the ban remains in force for the rest of 2026.
Entain said it was disappointed by a sudden move taken without consulting industry stakeholders given its serious consequences, but confirmed its Brazilian operations are complying with the provisional measure.
Betano weighs a legal challenge
Allwyn, which holds a 36.75% minority stake in Kaizen Gaming, owner of the Betano brand, said Betano is now weighing its legal options, including possible litigation to protect a five-year licence issued by Brazil's Secretariat of Bets and Prizes, the regulator under the Ministry of Finance.
Betano currently leads the Brazilian market with roughly 25% share and brand awareness according to Blask, and was named the country's most downloaded sports betting app in 2025 by independent market studies.