The first day of the Brasil Sports Betting Summit brought together in Sao Paulo numerous personalities from the government and the private sector to discuss the regulation of sports betting, the operation of state (and municipal) lotteries and the difficulty that the sector faces due to the waiting time that the signing of the presidential decree is promoting.
The sector's main question to the government was regarding the movement of the Ministry of Justice in collecting information on contracts with clubs, federations and Rede Globo regarding sponsorship and advertising. Nothing was clarified, since Iuri Castro made it clear that he could not comment on the matter. Despite this, he brought important information to the sector. The government has already prepared a Provisional Measure to accompany the decree that regulates sports betting.
According to the undersecretary for Special Affairs, Lottery and ZPE of the Economic Monitoring Secretariat of the Ministry of Economy, Iuri Castro, the group in charge of the work of regulating sports betting has carried out a tireless work of complete understanding of the sector.
“We have done, only in the last few months, what has not been done for years so that the regulation of the sector comes to a successful conclusion, in line with the best international practices. We have listened to countless regulators and studied all the laws and other legal documents that guide the activity and we are reaching a model that will meet the wishes of the sector, the needs of the government and what society expects,” he said.
According to Castro, it is not an easy job and the Ministry of Economy team has been looking into models already implemented in other countries and this will bring all the consistency that the activity deserves and the country expects. Even without giving a date for the signing of the decree that will regulate sports betting, the undersecretary let slip that, along with the regulation, a provisional measure will come out to give the direction to the activity in Brazil.
Abuses need to be avoided
In his presentation, André Gelfi, managing partner of Betsson in Brazil, said that the unregulated operation is not adequate and allows for abuses in the sector, which would be curbed by a regulatory body if the activity was already operating under adequate regulation and with clear rules. “After the elections, this issue tends to be resolved, as the problem of the lack of regulation became unsustainable, as the pressure only increases,” he commented, noting that even though it works well, sports betting needs to be regulated.
“That's for sure because the operation lacks security. Not only operators in Brazil, but especially those offshore, are clear that regulation is essential for the market to develop in a sustainable way. There is still a lack of security in the activity, mainly from a legal point of view,” added Gelfi.
“The case is being accompanied by an almost unanimous understanding that regulation is fundamental and good for everyone – bettor, operator and government. I see it with optimism and I believe that after the election, the matter will be dealt with,” said Gelfi.
In the opinion of Betsson's managing partner, "this will be very good, because this mess of a thousand small operators tends to consolidate and we will have some groups actually getting ahead of this marathon and it will be evaluated who actually followed the correct path and the market, which has grown a lot, will mature.”
According to the executive, the market, currently in the order of R$ 6.2 billion (US$ 1.2b) per year, will be made viable and will grow a lot and consolidate. “The trend is that the average ticket of betting in Brazil will change the scenario in the country and this will contribute to the growth of the activity based on the confidence that the bettor will have in a regulated activity,” he pointed out.
Good practices of regulated markets
Iuri Castro, was very incisive when he said that “we know that it is difficult to regulate the activity, as there are many variables involved. We have been working until dawn and on weekends, but we know that it is possible to carry out this work. We do not comment on draft decrees, but we can say that the decree will come and we are as anxious as you are,” he said.
According to the undersecretary, numerous jurisdictions were studied. “We have received several contributions from similar entities, as well as market players, to evolve the regulation process. Contributions were and are very welcome and we are working to have good regulation. We work for it and that is our goal. We do not work with any other objective and there are no other possibilities. We are preparing all forms, documents, processes and systems so that everything is prepared for the decree,” said Iuri, noting that market feedback has been important to deliver the regulation.
He took the opportunity to inform the market that the former secretariat was renamed to the Betting and Trade Promotion Subsecretariat, which does not change the body's attributions in any way.
According to Iuri, many issues are still being analyzed and “they are fundamental for good regulation and are being added to the final text, such as issues related to security, certifications and the fight against money laundering and attention to responsible gambling. We are not treating these issues as restrictive, but focused on good practices adopted in already regulated markets.”
State lotteries
Lawyers Carlos Gonçalves Júnior and Rafael Rodrigo Bruno, from the GBSA studio, dealt with state lotteries, highlighting the importance of the activity as a driver of the sports betting market, but that they did not advance due to inadequate formats of models defined for the operation.
Rafael Bruno highlighted the bidding processes for lotteries in Maranhão, Mato Grosso do Sul and São Paulo, among other states and municipalities, but an adequate model was not reached since the entities did not focus on successful models in other jurisdictions.
“In some states, the processes were suspended because they did not have adequate legal support for the operation itself to be in line with what is expected of a healthy lottery activity. We saw numerous questions from companies interested in participating in the business and as a result of these interventions, several suspensions marked the attempt to implement state lotteries,” he commented.
Activity does not coexist with manipulation of results
Angelo Alberoni, country manager at Betsson in Brazil, highlighted that it is very important that the regulation of sports betting arrives as soon as possible so that the market itself is consolidated and creates self-regulation formats to operate as it does in countries where it is already implemented years ago. “Sports betting needs to be considered as an economic activity like any other and be focused on good practices. The operator is not interested in manipulating results and the sector is very concerned about encouraging responsible gaming,” he commented.
These are the basic premises of sports betting and the regulation must be attentive to this, in Alberoni's assessment. “And it needs to be ready as soon as possible so that all players are aware of it. Sports integrity, for example, is highly encouraged by our industry. It was born out of a demand from the betting industry. There are those who think that the arrangement of a match happens because of a bookmaker, but it is exactly the opposite. This mission needs to be demystified in the market. FIFA itself created an integrity department together with Interpol, based on the risks that bookmakers have always faced, with a view to guaranteeing fair and non-manipulated results,” he said.
There are those who blame the arrangement of results on betting sites, according to Alberoni, stating that “the main houses, such as Betsson, are associated with entities such as the European Sports Security Association, to inhibit the attempt to manipulate results. This is not happening in Brazil yet, but we know that the CBF is moving in this direction and it is important that the sector contributes to inhibiting such practices,” he commented.
Guilherme Buso, business development manager at Genius Sports, a company specialized in the subject, reinforced Alberoni's position, noting that “the regulation must move in this direction. Genius has created an entire ecosystem linked to the theme and is one of the main promoters of transparency and justice in sport. More than that, we offer extremely powerful tools to ensure that bookmakers are not affected by actions that could tarnish their operations.”
For him, “Brazil is on the right path to seek, in regulation, the best international practices to combat earnings manipulation and we hope that this will be contemplated when the decree is released and in the ordinances that will follow, to ensure sustainable, reliable and sustainable operations who value sporting integrity.”
Fellipe Fraga, COO of EstrelaBet, not only endorsed the words of Alberoni and Buso, but reinforced: “We, as operators, have to be vigilant 24 hours a day, 7 days a week, to curb the practice of earnings manipulation. It compromises the credibility of bookmakers and is extremely damaging to the sport.”
Fraga cited a bid that ended in a goal during a football match over the weekend in Serie B of the Amazonense Championship in which a defensive player kicked his own goal. “This case, which has already been referred by the Amazonian Federation to the Court of Sports Justice and the Civil Police, is an example of what manipulation of results is capable of. We must always fight against this and report it to the authorities. For sports betting companies, these are attitudes that, in addition to tarnishing the image of the sport, compromise the image of the sector,” said Fraga.
Ludovico Calvi, CEO of the Global Lottery Monitoring System, endorsed this expectation and commented that Brazil can only gain from a regulation that contributes to inhibiting practices that tarnish the sector.
“Around the world we see attempts to manipulate results and more and more regulators, police and betting companies work together to fight criminal actions. We see that in Brazil the Ministry of Economy is following the same path and now we just have to wait for the regulation to be completed so that the country enters the modern sports betting market and that the practices of already consolidated jurisdictions serve as an example,” he highlighted.
Source: GMB
