Brazil's betting industry has abandoned plans to challenge the Ministry of Finance's rule that prevents social welfare beneficiaries from gambling online.
The regulation, introduced in August, requires licensed operators to block users registered in social programs like Bolsa Família, the biggest social aid in Brazil, from placing fixed-odds bets or making deposits with government benefits.
The measure followed public concern over reports that welfare payments were being channelled into online betting.
According to the Ministry, the restriction aims to ensure social funds are used for essential needs and to limit the social harm linked to gambling addiction.
Betting operators are now required to cross-check their databases against the Government's welfare registries to identify restricted users.
In the weeks following the rule's publication, parts of the sector prepared technical notes to challenge it, arguing that the policy created operational hurdles and unfairly restricted consumer autonomy.
However, the initiative was shelved after the Government withdrew a provisional measure that would have raised betting taxes.
With political tension easing, operators concluded that a court case would be expensive, poorly timed and risk damaging relations with regulators.
Besides, pursuing legal action to allow welfare recipients to gamble would probably have severely damaged the industry's public image and set back its reputation.
Supporters of the rule describe it as a necessary safeguard for vulnerable families and public health. São Paulo Congresswoman Andrea Werner said the measure prevents state transfers from being spent on gambling rather than basic needs.
"Families may neglect food or housing when faced with addiction, which also increases strain on Brazil's public health system," she said.
Education law expert Vanessa Ziotti added that social benefits are a tool of public policy and must be treated as such.
Brazil's Ministry of Finance recently launched an anonymous platform for reporting match-fixing
