Due to a loophole in the country´s contract law, online gambling is not technically illegal if the operator with whom the gambling transaction is made is based in a jurisdiction where gambling is authorized. Brazilians taking advantage of this loophole wager approximately $950 million per year with “offshore” operators based in jurisdictions such as the Isle of Man, Gibraltar and Costa Rica.
Now Brazilian Senator Ciro Nogueira has introduced UIGEA-style proposals that, if passed, would prevent poker players transacting with offshore operators using fiat currency and would have serious implications for worldwide poker liquidity at the world´s largest online poker sites. (READ HERE: THE FIRST ONLINE POKER NETWORK IN EUROPE)
In his bill, Senator Nogueira proposes that the Central Bank of Brazil introduces mechanisms to prevent Brazilian-based gamblers from transacting with offshore gambling sites by credit card, debit card or other electronic transfer.
The ban on gambling transactions includes both deposits and withdrawals.
The Senator acknowledges legislation is being discussed to regulate online gambling in Brazil; and, as the purpose of the domestic regulation is to generate tax revenues, he sees his bill as a step towards accelerating the process while preventing money leaving the country both before and after regulation. (READ HERE: ONLINE POKER LIQUIDITY, MORE COUNTRIES PUT THEIR INTEREST IN SHARED IT)
The implications for online poker if the law is passed would be serious. Brazil contributes a significant proportion of players to the databases of PokerStars, 888Poker and Party Poker. As none of these sites accept cryptocurrencies, over which the Central Bank of Brazil´s mechanisms have no control, there would be a vast drop in cash game liquidity and poker tournament entries.
