Latin America series: How licensing works in practice.

Three different coloured dice above a South American globe highlight a single regional market shaped by three very different licensing models in Brazil, Colombia, and Mexico.

Setting the Scene

The three frameworks covered in this article arrived at regulation through entirely different routes.

Colombia built its online licensing system from scratch in 2016 under Coljuegos and is widely recognised as the first Latin American country to implement a comprehensive online regime, giving it close to a decade of operational history.

Brazil created a federal framework through Law 14,790/2023, which came into force in 2025 under the Secretaria de Prêmios e Apostas — a brand‑new regulatory body administering a brand‑new market for one of the world’s largest populations.

Mexico never created a standalone digital licensing system at all — it extended a retail gambling framework from 1947, administered by the DGJS under SEGOB, to cover online operators through the permisionario partnership model.

What they share is a deliberate insistence on local presence as the price of entry. What differs is everything else: the structure of that presence, the cost of maintaining it, the technical standards required, and the effective tax take on whatever revenue remains after compliance costs are met. Operators who treat these three markets as variations on the same model will find the differences expensive.

Brazil Comprehensive Requirements, New Regulator, Live Market

Brazil’s federal betting framework is both the newest of the three and, on paper, the most demanding in terms of compliance.

The national regime established by Law 14,790/2023 is being implemented by the Secretaria de Prêmios e Apostas (SPA), which is translating high‑level statutory rules into detailed obligations through a steady stream of ordinances and technical notes.

As a result, many of the day‑to‑day requirements that matter most to operators now sit in secondary regulation rather than in the law itself.

Local presence rules are deliberately strict. Licensed operators must establish a Brazilian legal entity, hold a corporate bank account with an institution authorised by the Central Bank, use a dedicated .bet.br domain, and ensure that core operational data – including player and transaction records – are stored in Brazil or otherwise remain clearly subject to Brazilian jurisdiction.

Authorities also expect meaningful Brazilian participation in corporate structures, but the precise expectations on ownership and governance are still being refined through the licensing process, making the design of a compliant local set‑up a central strategic question for foreign groups rather than a formality.

Payments are another defining feature of the model. Real‑money gambling transactions are directed onto regulated rails such as PIX, Brazil’s instant payments system, alongside traditional bank transfers and locally compliant e‑wallets, while the use of credit cards and crypto assets for player payments is tightly constrained or banned under SPA’s payment rules.

Market research and supplier reporting consistently point to PIX as the dominant, most trusted option for Brazilian online bettors, which makes this design commercially viable but forces international platforms to invest in PIX‑ready integration, reconciliation and fraud‑monitoring capabilities they may not need elsewhere in Latin America.

On headline numbers, Brazil applies a GGR‑based federal tax that looks competitive when set against several established European markets. In practice, the real cost of entry is driven less by the nominal rate and more by one‑off and recurring compliance spend: forming and capitalising a Brazilian entity with acceptable local partners, certifying platforms and games through recognised laboratories, securing compliant data‑centre capacity in Brazil and continually adjusting internal processes to keep pace with SPA’s evolving ordinances.

Operational requirements add a further layer. Technical and supplier documentation highlights a growing list of mandatory protections – including robust KYC with biometric or facial‑recognition options, strong authentication, segregation of player funds and a suite of responsible‑gambling tools such as self‑exclusion, configurable limits and prominent safer‑gambling messaging. These expectations bring Brazil closer to emerging global best practice but also raise fixed costs, particularly for mid‑tier brands. For larger operators with the capital and patience to absorb these demands, Brazil offers a sizeable, high‑engagement market under a single national regime; for smaller entrants, the combination of local‑presence rules, payments specificity, and regulatory flux may make the barrier to sustainable participation considerably higher than the headline tax rate suggests.

Colombia: Mature Framework, With a Tax Lesson Built In

Colombia’s online regime, created under Law 1753 of 2015 (the so‑called 2016 eGaming Act), was the first fully regulated framework in Latin America and, as of 2026, remains one of the clearest illustrations of how tax design can influence channelisation.

Coljuegos licenses online casino‑style games and sports betting through a single authorisation per operator, with applicants required to be incorporated as a Colombian company or registered foreign branch, maintain an account with a financial institution supervised by the Superintendence of Finance (SFC), and comply with detailed technical standards, including strong information‑security, AML and KYC controls.

Colombia’s on‑shore model requires a Coljuegos licence for any operator targeting local players, and offshore authorisations – including licences from hubs such as Curaçao or Malta – have no legal effect in the domestic regime. To reinforce this monopoly‑based approach, Coljuegos has progressively deployed ISP‑level measures against unlicensed operators, initially reporting more than 8,600 websites promoting illegal betting and online casinos blocked and, by early 2025, a cumulative total of around 10,000 websites and social‑media profiles offering unlicensed gambling, with later statements citing significantly higher figures during the current administration. Unlike in the EU, where internal‑market rules and court rulings require gambling‑site blocking to be narrowly justified and proportionate, Colombia’s legal and ICT framework allows Coljuegos to instruct ISPs to block any operator without a domestic licence, and tens of thousands of domains and profiles have now been affected.

The core fiscal structure combines a 15 percent tax on net gaming revenue with a fixed annual fee equal to 811 legal monthly minimum wages and an additional 1 percent administrative fee calculated on the sum of fixed and variable gaming taxes. ENV and other specialist commentary describe how an emergency measure in early 2025 temporarily reintroduced a 19 percent VAT on online betting, with industry associations warning that, if applied to deposits or turnover rather than GGR, it would push the effective tax burden on licensed operators to punitive levels and undermine channelisation. Operators argued that the measure was already pressuring net revenue and encouraging players to seek cheaper offshore alternatives, while authorities stressed the need to protect public finances.

At the same time, policymakers signalled a shift back towards a GGR‑based VAT calculation, and from 1 January 2026 the 19 percent VAT has been applied to GGR instead of deposits – a correction that industry sources expect to bring the combined burden back into a more sustainable range. That episode is now widely cited in regional analysis as a case study of how moving away from GGR‑based taxation towards stake‑ or deposit‑based models can rapidly destabilise an otherwise functioning market, even where the underlying regulatory framework is relatively mature.

At the operator level, the Colombian framework has nonetheless supported growth where the tax and product mix remain viable. Rush Street Interactive has reported strong revenue growth from its RushBet brand in Latin America, with Colombia its largest market in the region and record monthly active users reported despite the drag from the temporary VAT measure. In a 2024 earnings call, management described RushBet as one of the leading online operators in Colombia, competing directly with BetPlay and Wplay, suggesting that a licensed operator can still build scale within the framework when the fiscal balance is sustainable.

Paseo de la Reforma in Mexico City, where domestic licence‑holders, regulators and financial institutions sit at the centre of an online market that international brands can only access through Mexican permisionarios. © Sipa USA / Alamy

Mexico: The Pernisionario Model and Its Structural Gap

Mexico’s regulated online market differs fundamentally from Brazil and Colombia because there is no standalone remote licence available directly to foreign operators. Under the Federal Law of Games and Lotteries (Ley Federal de Juegos y Sorteos, LFJS) and its 2004 Regulations (Reglamento de la Ley Federal de Juegos y Sorteos), the right to offer gambling rests with domestic licensees – the permisionarios – authorised by the Dirección General de Juegos y Sorteos (DGJS) under the Ministry of the Interior (SEGOB). International platforms that want local presence must therefore partner with a permisionario and operate under that concession, rather than holding an independent Mexican online licence in their own name.

ENV Media’s 2024 research notes that licensed operators can extend their land‑based concessions into the online channel and, in practice, partner with multiple international brands, creating a layered market where the legal entity is Mexican but many front‑end brands are international. Analysts broadly agree that Mexico has become one of the largest gambling markets in Latin America, with the online segment expanding quickly from a relatively low base and expected to account for a growing share of total betting and gaming spend. The broader financial infrastructure shapes payment flows: Mexico’s central‑bank‑operated SPEI instant transfer rail and the CoDi QR‑based payments platform are increasingly used for digital commerce and are highlighted by SOFTSWISS and payment specialists as important rails for iGaming deposits, even as cards, vouchers and e‑wallets remain part of the mix.

What Mexico does not yet have is a dedicated, fully modernised online licensing statute. The current regime relies on mid‑20th‑century primary legislation, updated through the 2004 Regulations and subsequent administrative practice, and on private‑law agreements between permisionarios and their international partners. That structure creates a clear dependency risk for foreign operators: access terms, risk tolerance and some compliance conditions are shaped not only by federal rules but also by the specific concession and commercial strategy of the Mexican partner. Domestic commentators and trade press increasingly describe draft reforms to the Federal Law of Games and Lotteries as an attempt to bring remote gambling into a more explicit and transparent framework, including clearer rules on online licensing, advertising and consumer protection, but until those reforms pass, the permisionario model remains the only realistic on‑shore route into a market widely valued in the low‑double‑digit billions of dollars across land‑based and online segments.

Industry Implications

For operators evaluating entry, the structural dimensions outlined above are a starting point rather than a checklist. Each requirement – from incorporation and banking to hosting, certification and payments – carries a cost that varies by company size, existing infrastructure and the speed at which regulators issue and update guidance.

For compliance teams, the most significant near‑term risk is regulatory interpretation lag: the gap between when legislation passes and when the authority clarifies how it will be enforced in practice. Brazil is currently in this phase. The SPA has been issuing ordinances throughout 2025, and operators have had to make implementation decisions before all guidance was finalised, adjusting as new technical notes arrive. Colombia has already shown that this lag can produce commercially damaging outcomes if a contested policy – such as the 2025 VAT approach – is implemented even for a short period.

For investors and analysts, Mexico’s permisionario structure introduces a dependency risk that the other two frameworks do not: the financial and operational terms of market access are shaped not only by the federal regime but also by the specific concession‑holder a brand partners with. That alignment may be attractive for some operators – especially those seeking a lighter on‑the‑ground footprint – and unworkable for others that favour holding licences in their own name.

For suppliers and platform providers, data‑hosting, certification and payments constraints across all three markets mean that infrastructure built for European or North American regulation cannot simply be redeployed. Platform localisation – from payment architecture and fraud controls to responsible‑gambling tooling and language – is therefore a material cost of entry, not an afterthought to be added once a deal is signed.

Article 3 in this series will move from frameworks to outcomes, examining the distance between regulation on paper and where players actually bet: channelisation rates, black‑market pressure, enforcement mechanisms and what Colombia’s 2025 tax episode reveals about how quickly a licensed market can destabilise when policy design misaligns with player behaviour.

Further Reading & Key Sources