iGaming affiliate Better Collective among the most affected companies as shares lose a quarter of their value on the news

Brazil’s gaming operators and industry associations have criticised the government’s decision to ban online gambling, warning that the only thing that will end is consumer protection.

Responding to Friday’s decision to ban online gaming in Brazil, the National Association of Games and Lotteries (ANJL) said that the prohibition will not end gambling, only the consumer protections that are available in the regulated market.

ANJL noted that an estimated 31 million Brazilians are active on licensed online gaming platforms, with the vast majority betting recreationally and responsibly. 

“These bets will not cease to exist with a provisional measure; they will simply change location to uncontrolled environments that accept minors and credit cards. In the authorized market, platforms verify age and taxpayer identity, adopt mental health policies, self-exclusion mechanisms, and collect taxes destined for public policies,” said the Association.

“We share the concern about family debt and problematic gambling, and those best positioned to address this problem are precisely a highly regulated market. This commitment is already in practice. The legal market currently prevents 3 million beneficiaries of social programs from gambling and has already processed 1.2 million self-exclusion requests. No illegal website does this.”

This sentiment was echoed by the Brazilian Institute for Responsible Gaming (IBJR), which also warned of significant economic damage as a result of the decision.

“Companies have made investments, hired professionals, developed systems, entered into contracts, and paid fees to comply with the requirements established by the regulations,” said the IBJR. “Shutting down this market shortly after its implementation will produce significant economic and legal impacts and compromise the progress made in formalizing and controlling an activity that already existed in the country. The ban also does not eliminate existing demand.

“The measure also eliminates, for consumers who migrate to illegality, access to protection mechanisms provided in the regulated environment, such as identification, facial recognition, limits, transaction monitoring, self-exclusion, and responsible gaming tools. By removing the activity from the regulated environment, the State also loses instruments for monitoring and tracking financial operations. The economic and fiscal effects are equally significant.”

The IBJR cites research by LCA Consultoria Econômica which shows that between 2027 and 2030, the prohibition on all fixed-odds betting could jeopardize between R$58 billion and R$73 billion in revenue, assuming that 80 to 100 per cent of the demand currently served by the regulated market migrates to illegal operators.

Allwyn, operator of the leading Brazilian gaming brand Betano, said in a statement Monday that even if the provisional measure is ultimately rejected by Brazil’s Congress, the shutdown is expected to last until early March 2027.

“At this stage, the measure is temporary, having legal effect for a period of up to 120 days plus any periods during which the Brazilian congress is in recess, i.e., to early March 2027. The measure will automatically cease to be in force if it is rejected by either house of Brazil’s Congress during that period, or if it has not been ratified by both houses before the end of the period,” said the company.

“Betano is evaluating potential mitigants to the impact of the provisional measure and is preparing legal action to protect its rights in Brazil in consideration of its five-year licence to operate, issued under the current government on 1 January 2025.”

Allwyn added that Betano’s operations outside Brazil account for the majority of its revenue and deliver a significantly higher growth rate than Brazil, but said that shutdown makes it is unlikely that the company will achieve its 2026 target AEBITDA margin of 37 per cent.

Allwyn also said that Betano represents only one component of its highly diversified lottery and gaming operations.

Online gaming affiliate Better Collective also issued a statement in response to the news from Brazil, warning that the company is now unlikely to achieve its previously stated financial targets for 2026.

Better Collective co-CEO Jesper Søgaard commented: “Brazil only established its fully regulated betting market in January 2025, and since then a large number of licensed operators have invested significantly in building businesses under the new framework. 

“Removing that regulated market will not eliminate the underlying demand for betting. Instead, it risks pushing millions of players toward illicit offshore operators that have not made these investments, pay no local taxes and operate without the same player protections. Our concern is that a measure intended to protect consumers could ultimately dismantle a regulated ecosystem that was specifically created to protect them.”

Better Collective said that the ultimate financial impact of the Brazil shutdown will depend materially on how the company’s partners respond to the new regulatory environment and the extent and timing of any changes to their operations.

The company is now forecasting annual revenue of growth of between 3 and 8 per cent in 2026, down from previous guidance of 7 to 12 per cent growth, and has suspended it share buyback program with immediate effect as a precautionary capital allocation measure.

London-listed gaming operator Entain also expressed disappointment by the sudden development, as well as the lack of consultation with industry stakeholders.

Brazil had been expected to account for around 5 per cent of Entain’s online net gaming revenue in 2026, although its EBITDA contribution was expected to be modest due to “the challenging and highly competitive operating environment”.

Entain said this morning that it is maintaining its full year underlying EBITDA guidance of £910 million to £960 million, but expects the Brazil shutdown to put it in the lower end of that range.

Shares in Better Collective AS (STO:BETCO) were trading 25.05 per cent lower at SEK79.60 per share in Stockholm Monday morning, while shares in Allwyn AG (ATH:ALWN) were down 1.66 per cent at €11.84 per share in Athens.

Shares in Entain plc. (LSE:ENT) were trading 3.11 per cent lower at 435.60 pence per share in London Monday morning.