Stake to challenge court's reversal of injunction against Brazil's licensed betting ban

Stake plans further legal action after a Brazilian court overturned an injunction that had temporarily allowed the operator to keep running despite the country's ban on licensed betting. The ban was issued by President Luiz Inácio Lula da Silva in late September, and the injunction had given Stake the right to continue operating until 25 October.

The following day, Judge Luis Antonio Johonsom di Salvo, president of the Federal Regional Court of the 3rd Region (TRF-3), suspended the injunction, leaving Stake banned again. The decision came at the request of the Attorney General's Office (AGU), which argued that the original ruling gave Stake an unfair competitive advantage over other operators.

Stake is represented by the Brazilian law firm Bichara e Motta Advogados. Partner Udo Seckelmann told iGaming Business that the company will challenge the decision and is weighing two possible strategies, without revealing the grounds. He said a positive result in the coming days could benefit other operators, and that the firm is aware of its responsibility to the wider industry.

A central argument concerns legal certainty. Operators entering the regulated market faced high barriers, including a BRL30 million ($6 million) licence fee and a financial reserve of at least BRL5 million, while international companies such as Stake had to establish a headquarters in Brazil. Seckelmann said the activity was prohibited before the two-year point of a licence valid for five years.

He also criticised the government's reasoning, saying the provisional measure was not based on studies or statistics showing the regulated market caused addiction or debt problems. In his view, illegal gambling, which he said was growing strongly, was the real source of those issues. He further called the TRF-3 ruling political, claiming the AGU targeted a court president seen as favourable to the federal government and that the decision cited only general principles.

The sector is also feeling the economic impact. A partial survey by the National Association of Games and Lotteries found that more than 3,500 workers have been laid off by Brazil's betting sector since the provisional measure was issued. Separately, two major gambling trade bodies have asked the Supreme Federal Court (STF) to declare the ban unconstitutional. Seckelmann expects that challenge to be resolved only after the second round of elections on 25 October, which is why Stake sought an injunction to preserve its position in the meantime.