Online betting restrictions drive illegal market growth in 11 nations

A study by Ranking dos Políticos examining 11 countries suggests that restrictions on online betting often fail to eliminate demand, instead driving users toward illegal platforms and causing capital flight. The research analyzed various regulatory models, including total bans, foreign operator vetoes, and state monopolies, in nations such as China, the United States, India, Switzerland, Norway, and Indonesia.

Key findings indicate that these restrictions frequently lead to decreased tax revenue and the transfer of funds to foreign jurisdictions. For instance, in China, where activity is prohibited, an estimated US$ 145 billion to US$ 307 billion flowed illegally to foreign platforms in a single year. In Indonesia, approximately 12.3 million people utilized illegal platforms despite recent declines in overall online betting volume. In India, following bans on cash-prize online games, roughly one in three users migrated to offshore sites.

In Brazil, the debate has intensified following a provisional measure issued by President Luiz Inácio Lula da Silva in September, which prohibited the exploitation, offering, and advertising of fixed-odds betting. This move prompted legal challenges from the National Association of Games and Lotteries (ANJL) and the National Association for Legal Security of Games and Betting (Anseja). In response, Supreme Federal Court Minister Luiz Fux has scheduled a public hearing for Tuesday to discuss the implications of these regulations.