Brazil’s Supreme Federal Court (STF) has once again pushed back a decision on whether the country’s decades-old ban on land-based gambling can stand, leaving casinos, bingo halls, and other physical gambling venues classified as criminal enterprises for now. The court paused deliberations on Extraordinary Appeal (RE) 966,177 during a hearing this past Thursday in Brasilia, with the case now expected to resume alongside related lawsuits over Brazil’s regulated online betting market.
The appeal centers on Article 50 of Brazil’s 1941 Criminal Misdemeanors Act, which makes it a criminal offense to operate games of chance in public venues or places accessible to the public. Reporting justice Luiz Fux has argued that the provision was incorporated into and remains compatible with the 1988 Federal Constitution, effectively voting to keep the ban intact. But Justice Flavio Dino, while agreeing with Fux’s read of Article 50 in isolation, asked for more time to review the case so it can be decided together with lawsuits challenging Brazil’s Bets Law.
Why the Court Is Stalling
Dino’s concern is one of consistency. Brazil legalized and began regulating fixed-odds sports betting and online casino gaming under Law 14,790/2023, building a licensing and tax structure for digital operators that has no equivalent for physical venues. During the hearing, Dino questioned how the court can treat gambling and betting as legally distinct when both involve games of chance, arguing the two issues cannot be cleanly separated. As a result, the plenary agreed to wait and rule on RE 966,177 in conjunction with two related actions, ADI 7721 and ADI 7723, which challenge the constitutionality of the online Bets Law itself.
The case traces back to a Rio Grande do Sul prosecutor’s appeal after a state court declined to apply the criminal classification to a man convicted over three slot machines found at his business, ruling the old law incompatible with constitutional principles. Because RE 966,177 carries “general repercussion” status, whatever the STF ultimately decides will set a binding precedent for thousands of similar pending cases across the country’s court system.
What Happens Next
Even if the justices eventually strike down Article 50, the STF cannot create a licensing framework for casinos or bingo halls on its own — that authority rests with Brazil’s National Congress and the president. A favorable ruling would simply remove the criminal penalty, not legalize commercial operations outright, and attempts to pass land-based gambling legislation have repeatedly stalled amid opposition from evangelical lawmakers. Meanwhile, President Lula da Silva’s administration has signaled it wants to move in the opposite direction on the digital side, pushing for restrictions on online casino gambling even as licensed sportsbook promotions continue to expand under the existing framework.
Attorney General Paulo Gonet argued during the hearing that Article 50 is still necessary to penalize unauthorized gambling operations despite the growth of the licensed betting market, while a Rio Grande do Sul prosecutor cited the risks of gambling-related debt tied to expanding access. With deliberations suspended for up to 90 days, Brazil’s two-track approach to gambling — regulated and taxed online, criminalized in person — remains in place for the foreseeable future.
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