Bets: Casinos arrive in Brazil with an eye on in-person gambling – 09/29/2024 – Market
Las Vegas casinos such as MGM Grand and Caesars Palace are close to obtaining a license to operate in the online betting sector in Brazil. Additionally, Hard Rock Cafe is looking for opportunities to enter the national market.
In-person gaming multinationals open their bets not only to profit from gaming on smartphones and computers, but also to experience the dynamics of the Brazilian market. They are already eyeing the chance to open casinos in paradisiacal spots and are looking to build their brands in the country.
Managers of these companies say that Brazil followed a process opposite to that seen in the rest of the world: it legalized betting before having the in-person betting market organized under State rules.
In parallel with the release of betting on the internet, Congress once again discussed bill No. 2,234 of 2022, which regulates gambling, horse racing and casinos. This is the Senate version of PL nº 442, approved in the Chamber of Deputies in February 2022 after being processed since 1991.
Caesars Palace already has a license from Loterj to operate with bets in Rio, is currently building its headquarters in Americana, in the interior of São Paulo, and is hiring. There are already 28 direct employees and the projection is to reach 100.
The casino portal aims to differentiate itself by offering exclusive games and requiring a high minimum deposit — “it should be around R$1,000”, says the company’s advisor in Brazil Paulo Morais, best known for founding the Espaço esthetics franchise Laser.
Big Brazil, which represents Caesars Palace in the country, has a share capital of R$36 million, of which R$30 million will go to the Treasury and R$5 million will remain in a guarantee fund required by the government.
“For us, physical gambling, if it becomes regulated in Brazil, is a natural path that we will follow to request a license as well”, says the president of Caesars Sportsbook in Brazil André Feldman.
Feldman has been following the debate over betting regulation in the country since 1996, when he began to get involved with the World Poker Championship, and has represented the American casino since 2019, shortly after the release of online betting during the Michel Temer government, in December 2018. .
Hard Rock Cafe’s vice president for Latin America, Alex Pariente, who has already had meetings with the Treasury, says he expects stabilization in Brazil’s legal scenario before announcing plans. “We are evaluating all possibilities in the market, it would be gratifying to also bring our brand to this sector when the opportunity arises.”
The company’s priority, however, is the in-person game. “The Brazilian market has always been very important for Hard Rock International, the country contributes significantly to the number of tourists visiting our properties in the USA and other parts of the world.”
MGM Resorts has already invested R$54.25 million in the venture it will launch with Grupo Globo, BetMGM. In a post on LinkedIn, the group’s executive president, Bill Hornbuckle, wrote that the company intends to bring the “authentic Las Vegas betting experience to Brazil.”
The rapporteur of the project that should free up casinos, senator Irajá Abreu (PSD-TO), told Sheet that the discussion about bets should not hinder the progress of the debate on the regularization of in-person games. In his assessment, there are conditions to vote on the proposal in October, after the elections. “It is a mature text, which has been in progress for more than 30 years.”
After the text arrived at the House, senators changed the term “constructed casino” to “installed casino”. The change allows international resorts to look for partners already established in Brazil, to adapt hotels into casino resorts, instead of building projects from scratch.
Thus, multinationals would save time spent on licensing, shortening the period for starting operations from five years to less than one year, says the president of Instituto Jogo Legal, Magnho José.
The measure, however, raises criticism from experts in the treatment of gambling addiction for increasing the population’s exposure to gambling.
According to the psychiatrist at the Gambling Outpatient Program at HC (Hospital das Clínicas), Rodrigo Machado, gambling, like drugs, has greater or lesser addictive potential.
The lottery, for example, tends to be less addictive, because news of the prize takes hours or days to arrive. “Slot machines, on the other hand, provide a much shorter space between the act of executing the bet and receiving the result, generating a hyperstimulation of the pathways that process pleasure in the brain and, therefore, generating greater excitability.”
For him, the arguments in favor of legalizing gambling go in the opposite direction to health and science criteria.
In a public hearing held in the Senate on August 9, Abreu stated that he had ten technical opinions in his hands from ministries under the current administration, such as Finance and Tourism, in favor of the legalization of the casino, Jogo do Bicho and Bingo. “The project, once approved, will be a major watershed in Brazilian tourism,” stated Abreu at the time.
The national secretary of Infrastructure, Credit and Investments of the Ministry of Tourism, Carlos Henrique Sobral, estimated that the approval of the law will generate more than 650 thousand jobs and will increase the country’s revenue by R$74 billion.
“We are going to have an investment of R$66 billion, more than 1,000% increase in investment [em turismo]”. Today, the sector represents 8% of GDP — it would rise to 9.2% in Sobral’s accounts.
In a statement, the Tourism department says it supports the legalization of casinos. “The forecast is for an investment of US$ 1 billion in each project.”
The Treasury, on the other hand, considers the risks of the activity, such as money laundering and damage to the popular economy. The solution, according to the Secretary of Prizes and Bets at the Ministry of Finance, Régis Dudena, is a text that ensures the possibility of responsible and technical regulation, based on data and evidence and in a timely manner so that the activity does not develop without effective rules, as initially occurred with the betting activity.
The project to legalize casinos, although supported by PT and Bolsonaro supporters, is still opposed in the Senate, led mainly by Senator Eduardo Girão (Novo).
Evangelical deputies, who lost the vote on the text in the Chamber during Jair Bolsonaro’s government, have also participated in public hearings and taken people who report debts of hundreds of thousands of reais.
THE PROJECT
Casinos must be integrated into leisure complexes, such as buildings or boats, and must meet the following requirements:
- Have hotels with 100 accommodations
- Malls
- Halls for social events
- And restaurants
The proposal provides for authorization for up to three casino resorts per state, depending on the size of the region’s population or the extent of the territory.
- The state of São Paulo will be able to install three casino resorts, as it has a population of more than 25 million inhabitants.
- Minas Gerais and Rio de Janeiro have between 15 million and 25 million inhabitants and may have two casinos each.
- Even without having enough population, Amazonas and Pará must also install two projects because of an exception to the rule, which allows more casinos for territories with more than 1 million km².
- The other states and the Federal District will only be able to have one casino resort each.
Companies will need to be accredited by the Ministry of Finance to operate their casinos for a period of 30 years, with possible renewal for the same period.
Approval of the text would also legalize gambling and bingo.
X-RAY
MGM Resorts
Founded: 1986 (as MGM Grand Inc., later renamed MGM Resorts International)
Net profit in the last quarter of 2023: US$313 million (R$1.7 billion)
Market value: R$63.28 billion
Area of activity: Hospitality, casinos, resorts, entertainment and real estate
Competitors: Las Vegas Sands, Caesars Entertainment, Wynn Resorts
Caesars Entertainment (Caesars Palace)
Founded: 1937
Net profit in the last quarter of 2022: US$ -72 million (R$ -392 million)
Market value: R$49.2 billion
Area of activity: Entertainment, hospitality, casinos, resorts, sports betting and online gaming
Competitors: MGM Resorts International, Las Vegas Sands, Wynn Resorts
Hard Rock Cafe
Founded: 1971, in London
Net profit in the last quarter of 2022: Company closed
Market value: It is privately owned by the Seminole Tribe of Florida
Area of activity: Entertainment, themed restaurants, hotels, casinos and musical events
Competitors: Wyndham Hotels, Virgin Hotels, B Hotels
