More than 3,500 workers lost their jobs after Brazil’s government moved to dismantle one of the world’s most anticipated newly regulated gambling markets.
A further 4,167 employees were placed on collective leave, according to industry association ANJL, as the provisional measure signed on 25 September took hold across the country.
The measure bans the operation, offering, intermediation, and advertising of fixed-odds betting in Brazil, covering both sports wagering and online casino products.
What makes the reversal particularly striking is that President Lula himself sanctioned the underlying framework, Law 14,790, back in December 2023, before approving the so-called Bets Law in late 2024.
The regulated market had only been live since 1 January 2025, leaving 85 licensed operators facing a rapid shutdown with no reimbursement for their licence fees.
Strategic advisory firm Regulus Partners has assessed the post-election outlook and concluded that the sector now sits in deeply uncomfortable territory, with no clear resolution in sight.
The firm does not anticipate Supreme Court Justice Fux moving to revoke the ban, nor does it expect the provisional measure to hold indefinitely, yet it also sees little prospect of the 2025-2026 operator licences being reinstated.
Regulus warned that the most dangerous scenario for the industry involves litigation rather than legislation, stating: “If Lula’s allies achieve concrete legal progress in suing the post-licensed sector for player losses, then this will probably bury the industry despite the lack of legal clarity on the ban.”
On the broader trajectory, the advisory firm wrote that “this scenario is likely to be resolved by more protracted lawfare, in our view,” suggesting a drawn-out rather than swift conclusion.
Before the first round of voting on 4 October, Regulus had placed the probability of the ban becoming permanent at just 5%, while giving an 85% chance that the blackout would persist as Congress examined the measure.
Justice Fux had deliberately held back from issuing any Supreme Court ruling prior to the runoff, reportedly seeking to avoid any perception of favouring one candidate over the other.
That caution meant the industry received no judicial protection on the precise day every operator licence expired, compounding an already chaotic situation.
One legal expert has projected that gambling-related cases could surge from 10 million to 20 million within three months, with roughly 18 months of further uncertainty ahead while lawmakers construct a fresh framework.
Lula had signalled his intention to reverse his own legislation just nine days before the first-round ballot, a timeline that gave operators almost no opportunity to prepare or respond.
The episode represents one of the most abrupt policy reversals seen in any major regulated gambling market, leaving investors, operators, and thousands of workers facing an extended period of uncertainty.
