It's clear Brazil is not going to be a flip the switch market.


You cannot just be offshore in December 2024 and then onshore, licensed, regulated in January 2025. The market does involve a substantial but probably appropriate


commitment financially, operationally and in compliance. That's


fundamentally why this is an open question since it is not necessarily an easy decision for all current operators to apply for a licence, and I do think that a key issue with the channelling rate is around the scope of permissible online casino games.


A couple of things we have learned recently is that opposition to gambling expansion is higher in the Senate than the Chamber of Deputies. So the Chamber of Deputies passed this legislation in February of 2022 and the Senate, it's fair to say, has made slow progress on it since then.


Some of the same senators that were very vocally opposed to online gaming and were highly engaged with limiting the scope of the online gambling bill. Some of those are, they're involved in the same committees and are and will apply the same tactics to this land-based gaming expansion bill.


So I think the conservative and evangelical bloc in the senate has real clout and influence and bringing up a vote on the gaming bill, even once it gets out of committee, which in and of itself is challenging, the senate president ultimately is going to encounter the wrath of evangelical conservative members for bringing this bill up for a vote. Everything is pointing to the fact that this is not going to be easy.


Is the bill simply too big?


I think there are two ways of looking at that issue. One is, because the bill is so broad, that naturally draws extra opposition from anti- gambling groups. But the flip side to that is, if


you try and narrow the bill down, you then lose support from the interest groups that are backing the different components within that. For example, there is a strong lobbying force behind bingo being legal. If you limit the bill to just casinos, you alienate that segment.


And then if you instead of having a minimum one casino in every state being allowed, and you do go something like Japan and say, well, we'll start with three casino resorts and go from there, then the risk is you lose votes from other senators that represent other states... So then it becomes a bit of a “what's in this for my constituents?” Tat is a delicate balancing act, it really is.


Turning to the online gambling bill, to what extent do you estimate it will channel players to the regulated market?


I think that's still an open question as we sit here, today . . .But it is a high barriers to entry market where the cost of a licence is 30 million reais, roughly a bit under six million dollars up front. Tere are other financial commitments that need to be made, you need to have substantial operations in Brazil and employees in Brazil.


Te technical requirements and standards are highly specific. Investment needs to be made in compliance operations plus up front financial


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