In recent years, the sports betting scenario in Brazil has undergone significant changes, driven by the growing popularity of games of chance, with a clear prejudiced objective and incompatible with the new constitutional order, and by the need of appropriate regulation.
Recently, on June 25th, long after the two-year deadline had expired, extended for another two years, to regulate Law No. 13,756/18, which legalized the lottery modality of fixed-odds betting in Brazil, known as the’ Lei das Bets’, the federal government sent Provisional Measure (PM) No. 1,182/2023 and Bill No. 3616/2023 to the National Congress, with constitutional urgency, which has already been approved in the Chamber of Deputies and is now in the Senate and could be passed to lock the agenda on November 11th, with the aim of modifying and improving the legislation on sports betting and allowing adequate regulation for the Sector.
However, the Ministry of Finance, despite the aforementioned PM not yet being converted into law, edited Normative Ordinance No. 1,230, published on October 27th, and here, in a perfunctory examination, initially highlight a specific provision, which opens discussions and criticism.
Article 25 of the aforementioned ordinance prohibits the broadcasting of advertising in nationwide sporting competitions by operators authorized to operate fixed-odd betting exclusively within the states and the Federal District. In addition to the confusing wording, on a hasty reading, the restriction would affect the aforementioned advertising, including in sports competitions held within the territorial limits of the federated entities themselves, considering cases in which certain local competitions have a national scope, but with interest or repercussion national.
Just as "no man is an island", according to the poem Meditation XVII, by the English poet and writer John Donne, no one exists in isolation, and everyone is linked in some way to society and the world around them, considering the interconnectivity and the interdependence of people, with the use of the subjective concept of national scope being inappropriate in a globalized world, where there can be remote interest and bets from anywhere on the planet, beyond the limits of the national territory, even in local sporting competitions.
The real intention of the ordinance has already been widely expressed and consists of maintaining the prohibition on the exploitation of state lotteries beyond their territorial limits, based on §1 of article 2 of the old Decree-Law nº 6,259/44. Being public knowledge and notorious the bold pioneering movement of the Rio de Janeiro State Lottery (Loterj), in the accreditation of companies to operate fixed-odd bets, in which interested parties place their bets declaring themselves within the territorial limits, in state level.
Affront to the principle of advertising
The main criticism of this restriction is related to the principle of publicity, one of the pillars of democracy. Restricting advertising from authorized operators, even at the state level, can be seen as a form of prior censorship. The principle of advertising aims to guarantee the free circulation of information and ideas, which is fundamental in a democratic society.
Principle of efficiency and constraint costs
Constitutional amendment no. 20/1994, which introduced the principle of Efficiency, also deserves attention. Restrictions such as those mentioned in the ordinance must be analyzed in light of this principle. The costs associated with restricting the placement of advertising in sports competitions must be evaluated in relation to the intended benefits. If the costs exceed these benefits, the regulation must be considered inefficient.
Equal conditions between federated entities and the Union
Another point to be considered within its constitutional powers is the equality of conditions between federated entities and the Union. Restricting the placement of advertising outside the territorial limits of the authorized entity in a given location may affect competition between others with regard to to the exploration of sports betting. The measure can be seen as an obstacle to fair competition and the development of the Sector, as has already occurred in the recent past and consolidated by the joint judgment of ADPFs 492 and 493.
International jurisdiction and internet access
With globalization and access to the internet, the effective application of territorial restrictions on the placement of advertising in sports competitions becomes challenging. Brazilian and foreign citizens have access to the World Wide Web, and other countries may not impose such limitations. This raises questions about the effectiveness and legality of the restriction, especially in relation to foreigners who wish to exercise their right to choose among sporting competitions held anywhere in the national territory.
In this sense, the regulation of sports betting in Brazil is a complex challenge that requires a balance between consumer protection, the interests of federated entities, in harmony with the Union, without neglecting constitutional economic efficiency.
The provision of article 25 of Normative Ordinance No. 1,230, which restricts the dissemination of advertising, deserves a careful review in light of constitutional principles, efficiency and isonomy, represented by equal conditions between federated entities and their administrative and financial autonomy , as well as the Internet Legal Framework and the globalized reality.
Any regulation must seek to maximize benefits and minimize costs, ensuring the free circulation of information and the competitiveness of the sports betting sector in Brazil, generating new opportunities, jobs, income and especially the indispensable legal security to attract the desired investments and obtaining resources for responsible gambling, social investments and combating illegal gambling, given that current legislation has demonstrated that it is incapable of effectively curbing it, so that the issue can be debated and the regulation of fixed-odd sports betting approved, with effective control, supervision and fair taxation.
Paul Horn
Master in law from the State University of Rio de Janeiro (Uerj), president of the Special Commission on the Law of Sports Games, Lotteries and Entertainment of the OAB-RJ and founding partner of Paiva & Horn associated lawyers.
Source: ConJur
