Fantasy games are online games in which users cast virtual teams of real athletes in a particular professional sport. The score that the user receives for the lineup of his virtual team is established based on the performance of the athletes in the real matches. The fantasy game organizer provides rules for converting the athlete's performance in the real match into in-game points.
For example, goal participation and assists count as positive points, while own goals and defensive failures count as negative points. At the end of the game round – usually corresponding to a round of a certain real championship – the points are compiled and the user whose team has totaled the most points rises in the ranking or wins, according to the specific rules of the game.
It can be seen, therefore, that fantasy games are not “games of chance”, but games whose outcome depends on the player's skill and not on a future and random event. For this reason, they are called “skill games” or skill-based games. This modality still needs more regulation in Brazil and, due to this legislative gap, many mistakenly consider it as a kind of game of chance - which would be a criminal misdemeanor according to the provisions of Decree-Law No. 1941 (Criminal Misdemeanors Act).
In Brazil, we have some fantasy games that are already well known to the public, such as Cartola FC and Rei do Pitaco. In this game mode, players assemble their own football teams, scaling coaches and athletes based on their performance in real life. The game rounds reflect the rounds of a certain championship that is taking place in that period (e.g. Serie A of the Brazilian Football Championship).
At the end of each round of the championship, a score is assigned to each player, a score calculated based on the performance of the athletes (scheduled for the virtual team) in the real match, carried out according to the table of the chosen championship.
The Rei do Pitaco platform, for example, rewards users in cash when they reach certain scores and results. In fact, the result of the performance of the participants is rewarded, which has nothing to do with the simple alley, a basic characteristic of games of chance.
Cartola FC, which does not distribute cash prizes to its users, has a contingent of more than 10 million active teams and 17 million downloads.
Recently, Grupo Globo announced the launch of Cartola Express in the first half of 2022 – still in the testing phase by users already registered on the platform – and it will be a fantasy game similar to Cartola FC, but with cash prizes for its users.
Fantasy games in the Brazilian context
Bill No. 442, of March 21, 1991, currently awaiting approval by the Federal Senate, was presented more than 30 years ago by the then federal deputy Renato Vianna (MDB-SC) and intended to legislate on gambling and betting in general, such as jogo do bicho, operation of casinos, bingos and sports betting (such as horse racing at racetracks), establishing, for example, the places and ways in which these games could be carried out.
However, with the advancement of technology and the emergence of "virtual games" that depend mainly on the player's mental ability and not a mere luck factor, the "skill game" modality also came to be included in the scope of Bill 442 /91, in one of its more than 20 amendments.
The approach to fantasy games was introduced by a substitute for Bill 442/91 and its appendices, dated August 30, 2016 (Substitute for Bill 442/91). The wording of the substitute for Bill 442/91 innovated by establishing definitions for “games of fortune” (games in which the gain and loss depend exclusively or mainly on a future and random event) and “bet” (mode of game of fortune) and distinguish them from “skill games”, in which the outcome is determined by the mental or physical abilities of the participant, even if there are random events.
Thus, article 79 of the Substitute to Bill 442/91 determined that “skill games” would not be subject to the legal regime established by the aforementioned law.
Despite not establishing extensive regulation on the subject, the text proposed by the substitute for Bill 442/91 clarified an issue long debated among those accustomed to the theme: games of skill, such as fantasy games, are not games of chance and, therefore, would not be subject to the penalties imposed by the Criminal Misdemeanors Law, being a legal modality in Brazil.
It is interesting to note, however, that a later update brought another, narrower scope, excluding from the legal text the aforementioned wording of article 79 on “skill games”, maintaining its scope in casinos, bingo and turf games.
Finally, on February 24, 2022, the Chamber of Deputies concluded the vote on Bill 442/91, which was approved. On March 4, 2022, it was submitted to the Federal Senate for consideration. It is worth mentioning that the version of the diploma sent to the Federal Senate reestablished the differentiation introduced by the substitute for Bill 442/91, discriminating, in its definitions, “game of chance” from “game of mental skills”.
According to the aforementioned version, “game of chance” would be the class or type of game in which the outcome is determined exclusively or predominantly by the outcome of a random future event defined in the rules system. The “game of mental skills” would be one in which the result is determined mostly or mainly by the mental abilities of the one who participates in them, such as dexterity, expertise, intelligence, training and mastery of knowledge, even if there are non-prevailing random events.
In addition, Bill 442/91 establishes that the Ministry of Economy will regulate the exploitation or organization of mental skills games within 90 days from the date of publication of the aforementioned law.
Fantasy games in the international context
On the international stage, the move towards the legalization or regulation of fantasy games is notorious. In India, for example, it is up to state legislatures to determine the legality of fantasy games, but courts tend to exempt from Indian gaming laws those modalities in which a user's success depends on the use of "substantial talent."
The Indian Supreme Court itself has demonstrated its understanding that games of skill are not games of chance and therefore can be considered commercial activities.
In Canada, there is an ongoing bill, the “Safe and Regulated Sports Betting Act”, or C-218, which aims to legalize betting on specific events and under the administration of the Canadian government.
In the United States, until 2018, sports betting was illegal, except in places like Las Vegas. However, the federal law that prohibited sports betting in the country was declared unconstitutional by the United States Supreme Court, leaving the responsibility for dealing with the issue to the legislators of each state. As far as fantasy games are concerned, it is worth mentioning that these are exempt from the Unlawful Internet Gambling Enforcement Act, as long as the value of the prizes does not depend on the number of players, the result is determined by the skill and knowledge of the player and is based on the statistical results of an actual athlete and the result is not defined by game scores or based solely on the performance of an individual player.
It is possible to notice that there is a great movement in Brazil and in the world for the regulation of fantasy games, mainly with regard to their differentiation from the modality of gambling. The approval of Bill 442/91 in the Chamber of Deputies represents a milestone for the regulation of fantasy games in Brazil, since the diploma not only differentiates fantasy games (“game of mental skills”) from games of chance, but also determines that the referred modality must be regulated by the Ministry of Economy within 90 days after the publication of the law.
The proposal is still subject to consideration by the Federal Senate. However, it is necessary to emphasize that there are strong barriers for Bill 442/91 to be approved. The government leader, deputy Ricardo Barros (PP-PR), has already said that President Jair Bolsonaro will veto the project if it is approved by the Federal Senate.
For now, we can only follow the procedure and hope that it is approved, since its approval will bring greater legal certainty and will transform the archaic regulatory framework of the Criminal Misdemeanors Law - responsible for prohibiting gambling in Brazil -, which gives rise to for a misinterpretation that the ban extends to fantasy games.
Fernando R. de Almeida Prado, Mariana Grande and Matheus Henrique Stringueto
Respectively, partner and associates of Pinheiro Neto Advogados
Source: LexLatin
