The exploitation of gambling, betting and casinos has historically generated heated discussions not only in Brazil, but throughout the world, a fact that, combined with cultural multiplicity and different legislative traditions, contributed to the emergence of different regulatory models, each of which with its peculiarity.
Perhaps the most emblematic of the international references of the gambling and casinos market in the world is the United States, with Las Vegas as the main example of an industry that has an estimated economic impact of approximately US$ 261 billion, involving the direct or indirect creation of 1.8 million jobs across the country. In the American model, the exploitation of gambling and casinos is permitted under federal law, with the states imposing restrictions and prohibitions. At the state level, in turn, there are several exploration models, ranging from more open and more restricted ones.
Some states such as Nevada and Louisiana allow casino operation throughout their territory, imposing zoning and licensing restrictions, while other states limit casino operation to only a few cities or districts such as Atlantic City, New Jersey, and Tunica, Mississippi. Other states almost completely restrict the practice, allowing it only in charity or lotteries, such as South Carolina.
In the case of Nevada, the state responsible for the regulation applicable to Las Vegas, the operation of casinos takes place through authorization, and the money laundering prevention policies are provided for in federal regulation, including the elaboration of internal controls, independent auditing and compliance, as well as systems for checking and recording customer information.
The situation is different in relation to electronic betting, given that few American states legalize and license electronic casinos. Even among the states that allow it, the provision of the service is limited for residents and for those who are located within the state in which there is a release for it, a reason that in general ends up bringing restrictions on the operation of online platforms, making them less competitive in terms of compared to foreign platforms.
Looking at Europe, the gambling tradition is remarkable in several countries, the United Kingdom being a clear example of transformation after a restructuring process, which took place through the Gambling Act of 2005, which allowed a considerable opening in the gambling market, having been renovated in 2014 and 2020 to adapt to the digital age.
In general, the UK openly allows the exploitation of gambling both physically and digitally, with specific licenses being required for the exploitation of activities. An operating license is required for any establishment that offers services related to gambling, whether offered remotely or not. In addition, specific licenses are required for physical facilities intended for gambling activities (in the case of casinos or bingo houses, for example), as well as personal licenses for individuals who perform management and operating functions in establishments of bets.
The British regulation is considered a reference as it is one of the most complete frameworks in relation to policies to protect minors and vulnerable people, as well as in relation to protection against money laundering. Regarding the second point, we highlight the requirement to carry out a risk assessment in relation to the possibility of the enterprise being used for money laundering and terrorist financing, the elaboration of preventive control policies, monitoring and review of control policies to ensure its effectiveness, as well as its updating based on new guidelines presented by the Gambling Commission, the body responsible for regulation and supervision in the UK.
Still in Europe, another country whose regulation is a reference for development in other countries is France. As a country with a very strong Catholic tradition, gambling was banned for much of French history. Over time, however, exceptions were created for some types of games, until, in 2019, the Action Plan for the Growth and Transformation of Enterprises allowed the French government to reform regulations about betting and games of chance.
The regulatory reform came in October of the same year, bringing several changes, especially in the regulatory vision, which leaves the focus of restriction and takes as its objectives the guarantee of integrity and transparency in betting operations, the prevention of excessive betting, the protection of of minors, the prevention of fraudulent activities and money laundering and the balanced use of different forms of gambling.
Currently, France issues licenses for physical establishments that offer horse and dog racing betting, casino games, poker, card games clubs, snooker, among others. Sports betting and lotteries are also offered in the country, but are included within the monopoly of a newly privatized company, La Française des Jeux.
As for online betting, all platforms that target the French public must be licensed by the Autoridade Nacional de Jogos (ANJ). Additionally, all platform providers must be listed in the licensing application. In addition, the software used by the platforms must be sent to the ANJ to be certified.
The activities currently allowed are poker, sports betting and horse racing betting. The regulation does not restrict licenses only to companies based in France, it also allows companies located in the European Union or the European Economic Area, as long as they have a treaty on tax evasion and fraud with France.
In relation to the control of money laundering prevention, the regulation approaches the British model, with the requirement of identification of the clients and the implementation of internal auditing and control procedures for the prevention of money laundering.
Migrating to the Asian continent, an important reference in relation to the gambling market is Singapore. The country's regulation is not positive through a consolidated statute, but by a set of rules that regulate the activities of bookmakers (Betting Act), gambling houses and public lotteries (Common Gaming Houses Act), lotteries (Private Lotteries Act) and licensed casinos (Casino Control Act). In addition, online platforms are regulated by the Remote Gambling Act. As in the UK, casinos in Singapore are required to carry out internal due diligence to detect potential money laundering and terrorist financing loopholes on a regular basis.
Regarding online gambling, the Remote Gambling Act establishes a different system, in which all online activities are prohibited, with the exception of those that have been exempted. The process to obtain the exemption requires that the operations center be located in Singapore, as well as that all relevant online content is also hosted nationally.
In addition, a number of restrictions may apply depending on the authority's judgment regarding the measures necessary to prevent harm in relation to addiction and money laundering. In 2016, the Singapore government approved the Singapore Turf Club and Singapore Pools exemptions, with restrictions that electronic activities should be limited to products already existing in establishments, with gambling being restricted in a casino model.
These are the main models that inspire discussions and modeling in Brazil, especially the current text of Bill 186/2014, from the Senate, and Bill 442/1991, the latter recently approved in the Chamber of Deputies and which is now awaiting appreciation by the senators. In the next article, we will deal with the main bills in progress in the country and the prospects for the legalization of gambling and casinos.
MARIANA SARAGOÇA
Lawyer. Partner at Stocche Forbes, which works in the areas of Administrative Law, Infrastructure and Regulation, with an emphasis on tenders (especially public-private partnerships – PPPs and concessions), administrative contracts and regulation of the main infrastructure sectors in Brazil. Bachelor of Laws from the Law School of the University of São Paulo (USP). Graduate in Infrastructure Law from the São Paulo Law School of Fundação Getúlio Vargas (GVLaw).
GREGORY BARBOSA BARBOSA
Lawyer for the Administrative Law and Regulated Sectors team at Stocche Forbes Advogados. Bachelor of Laws from Escola Superior Dom Hélder Câmara (ESDHC).
VICTOR NOGUEIRA
Legal Assistant of the Administrative Law and Regulated Sectors team at Stocche Forbes Advogados. Law Student at the University of São Paulo Law School (FD-USP).
Source: Jota
