Earlier this year, Brazilian top-flight side Flamengo revealed its plan to launch FlaBet in partnership with the licensed operator Pixbet.

On the latest episode of iGaming Daily, James Ross was joined by SBC Noticias’ Isadora Marcante and Fernando Noodt to look into the broader legal and regulatory implications, as well as challenges of the expansion.

The “groundbreaking” deal is unique in the world of football, with deals between clubs and sports betting operators usually limited to shirt sponsorships or social media collaborations. FlaBet is expected to net Flamengo a minimum of 82.5m Brazilian Reals (£11.3m).

On the significance of the deal, Fernando said: “This is something that I haven’t heard from any other club or any other sponsorship deal, even though the betting segment has been very present in the football landscape. 

“This is such an interesting opportunity for PixBet and Flamengo to run this brand. It also makes it a very good opportunity for Flamengo to make extra revenue because Brazil has been taking off financially in comparison to other countries over the last decade or so.

“I think clubs in other countries should maybe look into this type of deal because they need to start considering how to generate extra revenue so they can keep Brazil within reaching distance because the difference between Brazilian football and the rest of Latin America is insane.”

The FlaBet collaboration has been authorised by Loterj, the state lottery for Rio de Janeiro, despite Brazilian federal law prohibiting such a partnership. This conflict is just the latest in the ongoing battle between the regulatory organisations.

Earlier this year, Loterj stated that it plans to block all operators not yet licensed with the regulators in Rio de Janeiro. However, these plans were blocked by the 13th Federal Civil Court of the Judicial Section of the Federal District (SJDF).

Isadora explained that she believes the problems were caused by the federal government including the lottery when it legalised sports betting.

She said: “[The government] said that lotteries are a modality of sports betting. When you do that after the decision in 2019 saying that the federal government doesn’t have a monopoly on the lottery systems in Brazil, you are saying they can create their notices for accreditation and allow them to decide whatever they want.”

“Loterj is not doing anything against the law when they want everyone in Rio to be licensed, but it is overstepping the federal legislation at the same time. I do believe that Loterj should wait until 1 January  to do something because from that day onwards no illegal market should be able to operate in Brazil without being monitored and penalised.”

Fernando added that he believes that Loterj will fail in a legal battle with the government over its attempts to run Rio’s state gaming separately from the government’s laws and eventually federal regulation will be followed across the country.