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Bill creates Legal Framework for the Electronic Games Industry in Brazil

On October 19, 2022, the Brazilian House of Representatives approved Bill No. 2.796/2021 that creates a legal framework for the Brazilian gaming industry, considered as the largest electronic games’ market in Latin America, with an estimated revenue of R$12 billion in 2021 and a 6% growth forecast for this year.

The Bill seeks to regulate the commercial activities related to the creation, development, importation, and commercialization of video games, on any kind of platform (console, mobile, PC or subscription-based), as well as with entertainment services related to the so called “fantasy games”. The Bill proposes definitions for “video games” and “fantasy games”, as it follows:

  • Video Games: computer program that contains graphic and audiovisual elements, under the terms of the Brazilian Software Law, with playful purposes, in which the user controls the action and interacts with the interface; central device and accessories, for private or commercial use, especially dedicated to run video games; and software for cell phone application and/or internet page developed with the purpose of entertainment with fantasy games, expressly excluding from such definition the “slot machines” and other games of chance;
  • Fantasy Games: disputes that take place in a virtual environment, based on the performance of athletes in real sports events, in which (a) virtual teams are formed whose performance depends eminently on the knowledge, strategy and skills of users; (b) rules are pre-established, including the existence of any award of any kind; (c) the value of the award does not depend on the number of participants or the volume collected with the collection of registration fees; and (c) results do not result from a score or isolated activity of a single athlete or a single team in real competition.

Some other important aspects of the Bill indicate the legislative intention of developing a national gaming industry – tax incentives to the production and development stages as well as the requirement for government programs for the development of human capital for the industry.

With the approval from the House of Representatives, the Bill has now been sent to the Senate for examination and if approved it will follow for presidential sanction or veto.

For further information or any assistance on this matter, do not hesitate to contact our Marketing & Entertainment Law team at mkt&ent_law@kasznarleonardos.com.

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