Brazil’s Soccer Teams Want a Piece of the Online Betting Action

By | June 27, 2022

Sports betting and online gambling continue to be hot topics in Brazil, although legislative cohesion on how to proceed is at an impasse. When and if progress is made, soccer teams want a cut of the revenue.

Brazil's national soccer team
Brazil’s national soccer team celebrates a goal against Uruguay in the 2020 World Cup. Soccer teams in the country want to receive part of the revenue betting operators make. (Image: Marca)

Previous estimates put Brazil’s sports betting market at a value of around R$25 billion (US$4.8 billion) a year. As such, soccer clubs feel there’s enough money to go around and offer a convincing argument.

Last week, 15 clubs met with the Chamber of Deputies on Tuesday for another round of debates on the update to the Pelé Law, Brazil’s General Law of Sports. One of the topics of the meeting was the allocation of part of the revenue from online games to the teams.

A Plan Fit for Royalty

In that meeting, the clubs presented an amendment paragraph to the Pelé Law that grants them royalties. They explained that the economic return of betting data in the betting market is sufficient enough to produce revenue sharing to those who actually have the right to produce the data.

In other words, under the current legislative outline and similar to what is seen elsewhere, a sportsbook can put a team’s logo on its website. However, in return, it doesn’t pay for its use, even though it generates an income through that brand.

A recent survey showed that 28% of the Brazilian population has made some kind of sports bet. It also indicated that 31% of respondents spend between R$1 and R$20 (US$0.19 and $3.81). Fans of Fluminense, Flamengo, Palmeiras, Gremio and Corinthians spent the most.

The specific article of the Pelé Law that can be updated for the benefit of clubs is 42. This indicates that “the right to the playing field belongs to sports entities, consisting of the exclusive prerogative to negotiate, authorize or prohibit the capture, fixation, emission, transmission or reproduction of images by any means or process of a sporting event in which they participate.”

The clubs found support for their initiative in a key individual. They convinced the rapporteur of the Pelé Law in the Chamber of Deputies, Deputy Felipe Carreras, to accelerate an update in the text to adapt it to their wishes.

The eSports Ecosystem Finds a Friend

In addition to considering changes to Pele’s Law regarding revenue allocation, Brazil’s Senate is analyzing a bill that seeks to allocate lottery funds to eSports athletes. Senator Rosa de Freitas drafted the initiative, which provides for the inclusion of the Brazilian Confederation of Electronic Sports (CBDEL, for its Portuguese acronym) in the National Sports System.

The measure would update Pelé’s Law (9615/98) to include the entity for the administration of electronic sports in Brazil. It would also change a four-year-old law that deals with the destination of the proceeds of lottery collection. If lawmakers were to approve it, 0.04% of the resources would go to the promotion of eSports programs and projects.

The proposal provides for the allocation for the training and technical preparation, maintenance and mobility of athletes. It also dedicates resources for the promotion of participation in sporting events.

Currently, both changes are the focus of attention, but not of any clear forward progress. Moreover, unless Brazil’s Senate gets on board with legal sports betting, implementing any of the changes will be a drawn-out ordeal.

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