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Brazil’s regulated betting and iGaming industry may soon be subject to a new major change in the way it is regulated, as a new legislative initiative aimed at restricting user retention practices was introduced.
Senator Eduardo Girão (NOVO/CE) presented Bill 1018/2026, which seeks to amend Law No. 14.790/2023. The initiative aims to restrict the types of incentives offered by fixed-odds betting operators to retain and attract users.
If approved, the new legislation would likely require regulated betting and iGaming operators to revisit critical aspects of their customer relationship management (CRM) strategy.
Proposed Ban on Retention and Incentive Mechanisms
The new legislation would add a new article to the law: Article 29-A. This new article would eliminate some of the most popular practices employed by regulated betting and iGaming operators to retain users and maximize the Lifetime Value (LTV) of their customer base.
The new legislation would ban the use of cashback bonuses, both with a fixed value and without a fixed value, loyalty programs, points, and rewards based on accumulated player losses.
The new legislation would also ban gamification elements aimed at increasing user engagement within the betting platform. Examples of gamification elements include promotional “missions”, “challenges”, and leaderboards, where users can level up to a new level or VIP tier.
The restrictions on gamification elements would limit the types of user retention practices that can encourage users to gamble more frequently, spend more money, and engage for longer periods of time.
Restrictions on Personalized Communication
The new legislation would restrict the types of communication between regulated betting and iGaming operators and their users. Under the proposal, betting companies should not be allowed to send emails, notifications, and personal communications that utilize the betting history of the individual to promote more deposits.
It is worth noting that the law also requires betting companies to promote transparency regarding recommendation algorithms that may affect betting behaviors.
These aspects are likely to have a profound effect on the way in which betting companies in Brazil operate in the regulated environment.
Focus on Consumer Protection
According to the justification section of the proposal, Senator Girão asserts that betting companies in Brazil have resorted to utilizing various strategies that have replaced the previously prohibited welcome bonus incentives with indirect incentives that promote continuous stimulation of users.
According to the proposal, this has led to the implementation of a permanent system of behavioral induction for betting users in Brazil.
Therefore, the bill proposes that stricter technical criteria should be implemented by Brazil’s Ministry of Finance to determine behaviors associated with compulsive betting.
It is worth noting that the proposal is aimed at enhancing consumer protection, particularly for individuals who are deemed vulnerable to engaging in excessive betting behaviors.
Short Transition Period for Operators
If the proposal is approved by Brazil’s National Congress, betting companies in Brazil are expected to have a short transition period to comply with the proposed regulations.
According to the proposal, betting companies in Brazil have 90 days from the publication date to adapt to the changes in the betting environment in Brazil.
Source: iGaming Brasil
