EDUARDO LUDMER Head of Legal BetMGM Brasil
Well-structured operators need to incorporate tax sensitivity scenarios into their financial planning - whether through provisions, continuous review of operating margins, or contractual structures that allow for adjustments. At the same time, it is essential to reinforce that predictability is a fundamental pillar for any regulated industry. Abrupt changes, especially those with retroactive effects, directly impact investment decisions, job creation, and medium- to long-term planning.
Eduardo, with Brazil launching at 12 per cent GGR but already facing discussions around higher or even retroactive taxation, should operators treat the current framework as stable or as a moving target that requires structural hedging in their business models?
Te scenario needs to be approached with pragmatism and financial responsibility. Te current model represents an important step forward in terms of predictability and organization for the sector. However, it is undeniable that the regulatory environment is still in a phase of institutional consolidation.
In practice, this means that well-structured operators need to incorporate tax sensitivity scenarios into their financial planning - whether through provisions, continuous review of operating margins, or contractual structures that allow for adjustments. At the same time, it is essential to reinforce that predictability is a fundamental pillar for any regulated industry. Abrupt changes, especially those with retroactive effects, directly impact investment decisions, job creation, and medium- to long-term planning.
It is also worth remembering that, in the past year alone, the sector has already contributed billions of reais in taxes and paid significant licensing fees, making a meaningful contribution to federal revenue. Legal certainty is not just a demand from companies – it is a central element for the healthy consolidation of the regulated market.
As SPA ordinances continue to evolve, does regulatory agility become a true competitive advantage? How should operators structure their legal and compliance teams to anticipate change rather than simply respond to it?
Regulatory agility is undoubtedly a real competitive advantage. In a dynamic regulatory environment, the ability to quickly interpret new ordinances, understand their operational impacts, and implement adjustments efficiently can determine both the continuity and competitiveness of an operation.
But agility is not only about reacting quickly. It involves continuous monitoring, active participation in public consultations, transparent dialogue with regulators, and detailed technical tracking of regulatory developments. Institutional engagement and preventive compliance are fundamental.
Internally, the legal team cannot operate in isolation. It needs to be integrated with product, technology, marketing, communications, and finance. Regulatory interpretation must happen alongside business strategy. In addition, comparative analysis with other international markets helps anticipate trends and possible regulatory movements in Brazil.
How exposed are licensed operators to retroactive reinterpretations of tax or regulatory obligations? What legal safeguards genuinely exist if the rules shift after capital has already been deployed?
In any emerging market, there is some degree of regulatory risk, and that is part of the investment analysis. However, the Brazilian legal framework includes strong principles of legal certainty, protection of vested rights, respect for legal acts, and the prohibition of retroactive taxation, which serve as important safeguards.
Tis does not entirely eliminate the risk of interpretative disputes, especially in a new sector. For that reason, mitigation depends not only on legislation but also on the company’s internal structure - and at BetMGM we rely on extensive global expertise and highly qualified professionals to address this. Well-designed contractual models, robust governance, consistent technical documentation, and adequate provisions are all part of a preventive legal strategy.
In summary, the most effective protection mechanism is the combination of rigorous compliance, constant regulatory monitoring, and structured legal planning. It is not just about reacting to changes, but about building an operation capable of absorbing adjustments without compromising its long-term sustainability.
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