Sao Paulo (AFP) - Major Brazilian soccer clubs are in a severe crisis after sports betting companies, which are their biggest sponsors, were banned, leading to the suspension of multi-million dollar deals.

Published on: 09/30/2026 - 10:21

Thanks to the great financial support of their betting sponsors, Brazilian clubs have dominated their competitors in South America in recent years, winning the last seven titles in the Copa Libertadores Cup, equivalent to the European Champions League.

President Luiz Inacio Lula da Silva, who is locked in a fierce election contest against right-wing Senator Flavio Bolsonaro on Friday, signed a temporary decision to ban online betting companies, describing this sector as a "cancer."

Points that will be at stake:

How much revenue do the clubs earn?

14 of the 20 clubs in the Brazilian Premier League (Brazilerão) have a betting company as main sponsor.

These funds accounted for 34% of the clubs' commercial revenue in 2025, or about $200 million, according to investment firm Galapagos Capital.

Flamengo Club, the holder of the Libertadores Cup and the Brazilian League, has the largest annual sponsorship deal in the history of South American football with Betano, worth $46 million.

This amount is equivalent to what the club paid this year to include midfielder Lucas Paqueta, which sets a new standard in South American markets.

Flamengo club president Luis Eduardo Baptista asked in a podcast following the ban, “How will I pay for Paquita?”

"This action puts future revenues, the contracts we have signed, and the payments we have to make at risk," he added.

What will happen now?

The Lula Initiative ordered the removal of betting ads after October 5th.

A source in the Ministry of Sports told AFP that a meeting between the government and the clubs scheduled for this week has been postponed until after the first round of elections on Sunday.

The Senate has 120 days to decide whether to turn the temporary measure into law.

The main associations in the betting industry on Monday asked the Supreme Court to suspend the measure, claiming that it is unconstitutional.

Lula emphasized his position, saying, "Either I put an end to the bets, or the bets will put an end to Brazil."

The president claims that betting companies represent only 7% of clubs' revenues.

What risks do clubs face?

Experts warn that clubs face the possibility of a decline in the value of their commercial assets, as well as the possibility of legal action being taken against them.

Fabiana Bentis, from the Seu do Esporte Institute, which specializes in the sports industry, said: “The company, which is burdened with debt, lacks legal stability and cannot fulfill its obligations, is suffering from a decline in its value.”

Pedro Lourenco, owner of Cruzeiro, added that the loss was "very heavy."

He continued, "We are studying the situation and reviewing the accounts. It is not easy to determine the size of the loss today."

However, the Belo Horizonte club will receive financial support from the Minas Gerais state government, which has announced assistance to local clubs that have lost their sponsors.

Fluminense president Mateus Montenegro said it would not be easy for clubs to replace these sponsors.

"This obviously reduces the value of the asset, because any company interested in sponsoring a football club will have almost all the clubs available at the same time," he told CNN Brazil.

How will this affect Brazil's regional dominance?

Flamengo said in a statement that online betting revenues had “pushed Brazilian football to the point of domination” in South American competitions.

Betting sponsorship for Brazilian clubs emerged in 2019, filling the void left by the state-owned federal bank Caixa Economica.

This sponsorship has since been translated into 12 out of 14 Brazilian clubs reaching the finals of the Copa Libertadores competition.

According to the specialized website Transfermarkt, nine out of the ten most valuable clubs in the region play in the Brazilian League.

© 2026 AFP

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