Flutter Brazil's CEO João Studart recently called on policymakers to adopt a cautious approach to Brazilian gambling regulation, warning that excessive regulation could lead to the proliferation of the black market. Studart cited research from Instituto Locomotiva, indicating that by 2025, 61% of Brazilian gamblers might have engaged in illegal betting, and the combination of high taxes, bureaucracy, and advertising bans could backfire. Since the launch of Brazil's legal gambling market on January 1 this year, it has generated a total gambling revenue of 17.4 billion Brazilian reais (3.2 billion USD), contributing 3.8 billion reais in taxes. As one of the top three operators in the market, Flutter Brazil saw a 144% increase in revenue in the second quarter, reaching 44 million USD, with the company employing 500 staff and strengthening its market position through localization strategies.
Regulatory Warnings and Market Status
Flutter Brazil's CEO João Studart recently warned policymakers to be cautious about Brazilian gambling regulation. He emphasized that excessive regulation could lead to the proliferation of the black market, which is contrary to the original intentions of regulation.
The Brazilian legal gambling market officially started on January 1, 2024, and after a turbulent start, it is now at a critical stage of development.
Research Data and Risk Analysis
Studart referenced data from Instituto Locomotiva, showing that by 2025, 61% of Brazilian gamblers are likely to have engaged in at least one illegal bet. This data highlights the importance of regulatory balance.
The study suggests that the combination of high taxes, bureaucracy, and advertising bans could backfire, pushing consumers towards unregulated platforms that do not adhere to user protection rules or contribute to tax revenues.
Financial Performance and Tax Contributions
The Brazilian gambling market performed strongly in the first six months of regulation, with total gambling revenue (GGR) reaching 17.4 billion Brazilian reais (3.2 billion USD). The industry also contributed 3.8 billion reais in tax revenue to the Brazilian government.
This financial performance demonstrates the potential of the regulated market and its positive impact on public finances.
Regulatory Challenges and Policy Changes
The Brazilian gambling industry faces new challenges with advertising restrictions and retrospective tax plans, which require operators to pay for gambling services from the previous ten years. However, earlier this week, politicians withdrew this tax plan.
Studart emphasized the need to find a balance between tax burdens, advertising restrictions, and the attractiveness of the regulated market in an interview before the vote.
Market Opportunities and Development Prospects
Studart stated that the current regulations mark a "fundamental step" towards ensuring a safe and responsible licensed gambling industry in Brazil. Regulatory progress lays the foundation for establishing a balanced ecosystem, combining innovation with responsibility.
Flutter Brazil sees this new situation as fertile ground for sustainable growth, and is confident about the company's future development.
Overview of Flutter Brazil's Operations
Flutter Brazil was established last year by Flutter Entertainment, which agreed to acquire 56% of the shares of Brazilian brand Betnacional's parent company NSX. The transaction was completed in May this year, and Studart was appointed to lead Flutter Brazil's operations.
The company currently has about 500 employees, committed to creating the best experience for users through technology, marketing, and customer service.
Performance Growth and Market Position
In the second quarter of 2024, Flutter Brazil's market revenue grew by 144%, reaching 44 million USD, making Brazil Flutter's fastest-growing market. Data from September shows that the acquisition of NSX Group has given Flutter an 11% market share in Brazil, placing it among the top three in the market.
The company is consolidating its market position through localization strategies and investments, committed to long-term development.
Localization Strategy and Operational Philosophy
Flutter Brazil opts to retain a team with a dedicated focus on the Brazilian market's spirit and expertise. Betnacional, as part of its brand ecosystem, aims to maintain operations centered around Brazilian talent and local insights.
Studart emphasized, "The Brazilian market is in an integration phase, which brings tremendous opportunities for operators who invest seriously, adhere to a consumer-first philosophy, and are committed to best practices."
Balance Strategy and Regulatory Advice
Studart advises policymakers to adopt a balanced strategy to avoid excessive regulation: "These research findings suggest that the combination of high taxes, bureaucracy, and advertising bans could produce effects contrary to expectations."
He calls for a cautious balance between tax burdens, advertising restrictions, and the overall attractiveness of the regulated market to ensure regulatory effects meet the intended goals.
Future Outlook and Industry Maturity
By combining global scale with a deep understanding of local features, Flutter Brazil aims to actively promote industry maturity, providing users with relevant and safe experiences. The company emphasizes the importance of trust, transparency, and the pillars of Brazilian culture.
Studart concluded, "Regulatory progress lays the foundation for establishing a more balanced ecosystem, combining innovation with responsibility, and supporting the sustainable development of the industry."
