New Secretariat of Prizes and Betting (SPa) Guidelines Tighten Compliance Controls
The Ministry of Finance of Brazil has promulgated a new regulatory Ordinance designed to substantially enhance federal oversight of commercial lotteries, prize drawings, and promotional practices across the country. The central intent of the newly enacted document is to prevent unregulated enterprises from capturing or impacting public savings via unapproved financial draws. Specifically, the framework outlines clear, aggressive measures to crack down on and control the operations of businesses executing promotional activities without securing explicit prior government authorization.
Formally issued by the Secretariat of Prizes and Betting (SPa) as Ordinance SPa/MF No. 1,818, the updated regulation targets a wide array of unauthorized actions. These include running unapproved public contests, sweeping draws, and promotional advertisements without receiving prior federal validation, while strictly monitoring that authorized campaigns adhere transparently to their stated conditions and intended purposes.
Tough Administrative Sanctions for Unlicensed Marketing Campaigns
The regulatory authority has established rigorous penalties for corporate entities, civil society organizations, and broadcasting concessionaires that execute sweepstakes or lotteries without prior federal approval. Under the newly implemented guidelines, financial penalties are tied directly to the scale of the unapproved promotion, maxing out at 100% of the total market value of all prizes or items promised to the public.
In addition to heavy financial fines, the Secretariat can revoke an organization’s license to host promotional campaigns and enforce a strict three-year ban preventing the business from initiating any similar marketing operations. To keep the process moving efficiently, the administrative enforcement process will run primarily over digital platforms, requiring businesses under investigation to submit their formal legal responses within 30 days of receiving an electronic notification.
Commitment Agreements: An Alternative Path for Dispute Resolution
To avoid lengthy legal proceedings and optimize the efficiency of federal oversight, Ordinance No. 1,818 introduces the Commitment Agreement as an alternative mechanism for dispute resolution. This provision gives organizations under investigation an official avenue to settle issues directly with the public authority before a first-instance sanction decision is finalized.
To successfully qualify for a Commitment Agreement, the enterprise must adhere to several strict conditions:
- Immediate Cessation: The disputed lottery or promotional campaign must be stopped instantly.
- Operational Correction: The company must completely fix any detected compliance errors or operational mistakes.
- Damage Compensation: The business must fully compensate for any proven damages or negative impacts caused to consumers.
- Treasury Settlement: The organization must pay a calculated settlement fee directly into the National Treasury Single Account of Brazil.
While entering into a commitment agreement pauses the active administrative enforcement process during its fulfillment, the Ministry of Finance emphasizes that this path does not block or hinder ongoing criminal investigations if illegal activities are uncovered during the compliance review. Through these clear compliance measures and alternative dispute tools, the federal administration aims to increase regulatory certainty and build a transparent environment for prize promotions across Brazil.
