Since a long time, the release of the gaming sector in Brazil has been discussed. I really believe that this discussion has already begun there by the ides of 1946, shortly after the publication, by the then President of the Republic, Marshal Eurico Gaspar Dutra, decree no. 9.215, of 30/04/1946, which prohibited, in the name of the "moral tradition of law and religion" (see below the initial text of the mentioned Decree) gambling in Brazil:
"The President of the Republic, using the attribution conferred on him by Article 180 of the Constitution, and
Whereas the repression of gambling is an imperative of universal consciousness;
Whereas the criminal law of all educated peoples contains precepts aimed at that end;
Whereas the legal and religious moral tradition of the Brazilian people and contrary to practice and exploitation and gambling;
Whereas, from the exceptions open to the general law, abuses have occurred which are harmful to morals and good customs;
Whereas licences and concessions for the practice and exploitation of gambling in the Federal Capital and in hydrotherapeutic, seaside or climatic resorts have been given precariously and may be revoked at any time:"
At this time, overnight, famous and luxurious casinos had to be closed, such as Copacabana Palace and Urca, in Rio de Janeiro, Quitandinha, Petrópolis, Monte Serrat, Santos and Pampulha, in Belo Horizonte. And since then the game has become a criminal misdemeanor.
The discussion gained new air in December 2018, with the publication of Law No. 13,756, which created the modality called FIXED QUOTA BET. At the beginning of 2019, the discussion was further strengthened when a draft decree was released that would regulate this lottery modality. On the face of it, the draft predicted that the aforementioned lottery would be exploited "exclusively in a competitive environment." This would mean breaking the monopoly of the Federal Savings Bank over lotteries. The draft also provided that such bets would be linked exclusively to real sports-themed events. At that time, everything indicated that the project would be approved, being carried until the eminence of the signature by the authorities of the Executive Branch.
An interesting fact is that such a draft brought the following destination of the total collected:
The Decree also established that the percentage of 99% broken down above would be the object of decomposition between expenses with costing and maintenance and gross prize, at the discretion of the operating agents.
There was also the determination that the betting operator constituted a minimum capital of R$ 6 million, as a way to ensure the financial capacity of the business. In addition, the draft established severe penalties for violators of the rules, which could reach up to 100% of the company's gross revenue, among other penalties.
A communication noise created by the disclosure of this draft was that it would contain the permission for distribution of prizes of amounts less than R$ 10,000.00, without proper authorization. In fact, what the draft establishes is that only prizes over R$ 10,000.00 would need to be communicated to the UIF (Financial Intelligence Unit) of the Central Bank, as a measure to prevent money laundering. For the lower value premiums, there would be no need for communication to the BACEN. But that doesn't mean you could distribute these awards without authorization.
From then on, a lot of water rolled, but the boat didn't leave the place. At least from a legal point of view. In practice, several companies invested in the business, but due to lack of regulation, had to host their websites outside Brazil, such as the domain ".io" (location identifier of the platform in the British Indian Ocean Territory). The interesting thing is that, without regulation, activity should still be considered illegal in the country. However, there is constant publicity of betting services in the Brazilian media. And advertising 100% directed to the national public.
Apparently there is still a dispute within the Executive Branch over who will be the Regulatory and Controller of the activity. The very draft of the Decree presents several times the expression "... it is the responsibility of the Ministry of Economy, or body that succeeds it...". That is, already at that moment, there was an uncertainty of who would be the owner of the boat. Until recently, the subject was in the sphere of the Ministry of Economy, along with our commercial promotions, which, in my opinion, would harm us a lot, since it puts us on the same level as gambling. For those who remember, when the Government put us next to Bingos, the promotions market fell from 6,000 to less than 500 promotions per year, due to the difficulties of obtaining authorization. More recently, the matter has been passed on to the Ministry of Justice and, if it depends on my will, it will remain there forever.
May the promotions live, autonomously and independently of other forms of distribution of prizes other than our own!
Antonio Salgado Neto
Managing partner of ASPN Soluções Legal, a company that advises agencies and customer marketing departments in everything that concerns the legal aspects of promotions with the official agencies.
