The sports betting and online gaming sector, represented by five entities, has just launched an "open letter to the nation" in which they defend themselves from criticisms suggesting that the population is getting more indebted and consuming less because of "bets". This is the first move by the industry against irresponsible and inconsistent publications about the activity.
The entities claim that, since last year, the country has been going through a "historic moment" with the regulation of the sector, but that, economic segments have shown, due to ignorance of the practices adopted by the industry, "concerns, often premature" about the impacts of these entertainment services.
The text does not directly refer to any market player, but it is a response to several of them. PwC Brazil, for example, released last week an estimate that people with lower incomes dedicate 1.38% of the family budget to bets — the data is refuted in the "open letter".
In addition, it mentions that economists from Itaú calculated that Brazilians lost R$ 23.9 billion in bets over a period of one year. Another reference is about the disclosure from Santander, which warned of a possible relationship between the rise of bets and the fall in retail sales.
In mid-August, the president of CVM, João Pedro Nascimento, publicly stated that the topic is alarming and has the potential to "empty the refrigerators of Brazilians".
In the open letter to the nation, the entities reinforce "their commitment to consumer protection, transparency, and the fight against any harmful practices".
They also clarify that, in fact, the majority of the betting consumer public would not be from the lower income social strata (as mentioned in the PwC Brazil study). The target audience would be middle class (B and C): "Financially more vulnerable people, although present in the universe of bettors, represent a tiny fraction", states the message.
The entities also demonstrate data from IBGE, released a few days ago, which indicate an increase in family consumption (1.3% more now than in the first quarter of the year, and 4.9% above the same period of 2023). Says the letter: "Brazilians are not ceasing to consume to bet".
In the letter, the associations point out what would be "serious companies, with a long and solid trajectory in the international market", including those that sign the letter, and the "adventurous betting houses without commitment to integrity (...)".
There is also a reflection on people addicted to betting — cases that would supposedly be "rare". Declare the operators, finally:
"The industry, however, does not turn a blind eye to the lamentable real cases, which have been reported, of compulsion, although rare. (...) They reaffirm that they are committed to a regulated, integral, and responsible environment, being totally opposed to any tools or promotional materials that induce the bettor to compulsive behavior or to promises of easy money".
"Open Letter from the operators of sports betting and online games to the Brazilian Nation
Brazil has been experiencing, since the beginning of 2023, a historic moment through the regulation of a new industry, that of sports betting and online games. In recent months, various sectors of the economy have shown concerns, often premature, about the potential impacts of these entertainment services on the population. Therefore, the operators subscribing to this Open Letter to the Brazilian Nation come to clarify some points and express their commitment to consumer protection, transparency, and the fight against any harmful practices.
It is necessary, first of all, to dismiss information that has been speculatively disseminated about the market. From 2019 until now, Brazil unfortunately has an unregulated sector, whose ongoing process will only be concluded at the end of this year.
This regulatory gap has enabled the arrival of serious companies, with a long and solid trajectory in the international market, but also of adventurous betting houses without commitment to integrity and responsibility.
However, any statements that the betting industry is responsible for a supposed reduction in Brazilian consumption or an increase in the level of indebtedness do not hold factual support. The data released this week by the Brazilian Institute of Geography and Statistics (IBGE) show that, just in the second quarter of this year, family consumption advanced 1.3% compared to the first quarter of the year and an impressive 4.9% compared to the same period of 2023. In other words, Brazilians are not ceasing to consume to bet.
One of the recently released surveys indicated an average of 1.38% of the household budget, by bettors from social strata D and E, with bets. The industry that operates seriously in the country does not recognize these social layers as its main consumer public, which is more concentrated in profiles B and C. Therefore, financially more vulnerable people, although present in the universe of bettors, represent a tiny fraction.
The industry, however, does not turn a blind eye to the lamentable real cases, which have been reported, of compulsion, although rare. For this reason, the betting houses that sign this Letter come to reaffirm that they are committed to a regulated, integral, and responsible environment, being totally opposed to any tools or promotional materials that induce the bettor to compulsive behavior or to promises of easy money.
As one of the ways to demonstrate this commitment, the operators are organizing awareness and education campaigns for bettors, reiterating the message that online games and sports betting should be considered forms of entertainment and not a source of income.
Working against regulation is the same as supporting the permanence in the country of illegal sites, without the slightest concern for the good rules of the regulated market. It means empowering those against whom the government, serious companies, and society should fight.
Finally, the companies express the certainty that, from January 1, 2025, with the entry into force of the regulated market, Brazil will have a safe environment for betting, with clear rules and punitive measures for those who disrespect the main focus of operations: the consumer.
September 13, 2024"
National Association of Games and Lotteries (ANJL) – organizer
Brazilian Institute for Legal Gaming (IJL)
International Gaming Association (aigaming)
Brazilian Association for the Defense of Sports Integrity (Abradie)
Association in Defense of Integrity, Rights and Duties in Games and Bets (Adeja)
Source: GMB
