The legalization of casinos in Brazil has been debated for many years in the National Congress. And, finally, at the end of last February, the House of Representatives approved the basic text that proposes to legalize the exploitation of games in national territory. This approval has been promoted as an important driver of Brazilian tourist activity.
First of all, it should be considered that the aforementioned legislative proposal will still be reviewed by the Federal Senate and, if approved, will be submitted to the sanction of President Jair Bolsonaro who, publicly, has already expressed his intention to veto it in full. We know that the reasons are directly related to the political interests of its allied parliamentary base, known as Evangelical Bench.
As a representative of tourism, I want to remind that the passion for gaming has been present in the lives of Brazilians since the 1930s and 1940s, which placed several Brazilian cities on the route of international tourism, bringing social, cultural, artistic, political and economic development population.
The exploitation of gaming and betting, therefore, will serve as an instrument to promote tourism, the generation of employment and income and regional development, making concrete mention of providers of tourist services (such as hotels, bars and restaurants) when dealing with the exploitation of games through casinos, granted for 30 (thirty) years, renewable for an equal period, through public auction, in the technical and price modality.
But, starting from the entirety of Bill No. 442/91, it is immediately clear that it is not an economic regulation, in the technical sense of what the term requires. In this step, there is no institution of a regulatory agency provided with independence in relation to the granting power (Federal Union) and managed by directors with a notorious technical profile and endowed with a revocable mandate, despite the very text approved within the scope of the Chamber authorizing the creation of a regulatory agency, which will integrate the SINAJ – National System of Gaming and Bets.
On the contrary, the text clearly indicates that the “exploitation of games and betting constitutes subject private economic activity, under the terms of art. 170, sole paragraph, of the Federal Constitution, to the control and supervision of the Public Power and to the observance of the provisions of this Law and the regulations in force, in view of the public interest relevant to this market”. As can be seen, the exploitation of games and betting will be under the direct control of the Granting Authority (Federal Union), through the Ministry of Economy, which will be responsible for the regulation, accreditation of operators and the inspection of the activity, as well as issuing regulations on the exploitation and/or organization of games, within a period of up to 90 days after the Law derived from Project n° 442/91.
In turn, the bill establishes that the exploitation of games and betting will be private to legal entities licensed by the Ministry of Economy to act as “gaming and betting operators”, which indicates that the activity will be subject to political fluctuations of each representative of the Executive Power. It is important to note that the degree of intervention of the Granting Authority in the operating entity reaches the point where it has the prerogative to analyze and approve (or not) its electoral process, inauguration and the exercise of positions in statutory bodies of the entity, under the generic argument of the existence (or not) of convenience to the public interest.
Also among the eligible criteria that should guide the process of choosing tourist casinos through public auctions, the bill foresees the hiring, preferably, of local labor; the number of jobs to be created; the realization of investments, by the accredited party, in the maintenance of the casino, in compliance with the safety rules in the construction, expansion, renovation or re-equipment of casinos; education and training programs with effective use of professionals in hotels, tourism and related services; and the prohibition of granting, by establishments, loans of any kind.
Economically speaking, the proposed rule provides for a minimum paid-in share capital and on the gross revenue earned as a result of the exploitation of games, budget allocation of 12% of the collection to Embratur; 10% for actions in the sports area; 10% to the national culture fund; 4% for public health; 4% to health actions related to gambling; 6% national public security fund; 4% National Fund for Children and Adolescents; 4% for animal defense and protection actions; 4% to the Student Financing Fund (FIES); 5% for actions to rebuild areas at risk or impacted by natural disasters and actions to build housing for the low-income population relocated from risk areas or impacted by natural disasters; 5% to actions aimed at preventing natural disasters within the scope of civil defense; and 1% funding the training of athletes (Brazilian Committee of Clubs).
In addition, the proposed standard establishes the possibility of “casinos in integrated leisure complexes” with a maximum area of 20% of the total installation area, must operate together with integrated leisure complexes or boats, built specifically for this purpose. The so-called integrated leisure complexes must contain, at least, high standard hotel accommodations, with hotels with at least 100 (one hundred) rooms; places for holding large-scale social, cultural or artistic meetings and events; restaurants and bars; and shopping centers.
In this regard, the FBHA understands that, in compliance with article 180 of the Constitution of the Republic of 1988, projects originating from national investors for the installation of such leisure complexes should be privileged, as a way of promoting and encouraging national tourism, as a factor of social and economic development.
An important point to be considered lies in the creation of "tourist casinos", to be licensed in "localities", where the Ministry of Economy must necessarily consider the existence of tourist heritage to be valued and the potential for the economic and social development of the region, which , certainly, limits the discretion of the Grantor. Such "localities" should also privilege the increase of tourism with national or regional development policies, being certain that those classified as tourist centers or destinations (places that, due to natural, historical, economic, geographic or administrative characteristics, have an identity region, adequate infrastructure and offer of tourist services, high density of tourists and title of natural heritage of humanity, in addition to having tourism as an important economic activity) may have 1 (one) tourist casino installed, regardless of the population density of the state in which locate.
Among the various benefits for tourism and for Brazil, the potential that our country has to move with the gaming sector is very significant. According to the Brazilian Institute Legal Gaming (IBJL), there would be R$ 66 billion in movement and around R$ 30 billion in taxes per year. This collection is already much more than double what is collected in official gamings, such as lotteries, for example. Once again, I would like to highlight the generation of thousands of legal jobs and guaranteed labor rights for those who currently work irregularly, since the activity is clandestine. The perspectives indicate that, in the casinos alone, there would be more than 400 thousand jobs, in a country that currently has 12 million unemployed Brazilians.
I conclude by emphasizing that the approval of the Federal Senate and presidential sanction of this Bill is of paramount importance, especially after such a troubled period and the economic recovery of the country and the sector of tourism, hotels, bars and restaurants, one of the most affected negative effects caused in the sector, as a result of the Covid-19 pandemic.
Alexandre Sampaio
President of the Brazilian Federation of Accommodation and Food (FBHA)
