Fabiano Jantalia, Founding Partner of Jantalia Advogados, began the panel by outlining an overview and listing the biggest problems to be addressed in the current Brazilian regulatory environment.
“We need to establish a conceptual basis for the area, correct the problem of approach that today is exclusively criminal and start working with propositional legislation that structures the functioning of the market, that this structuring is not done by a biblical law of biblical proportions, but a lean law. We need a general lottery law that establishes concepts, modus operandi, and even incorporates the issues that are present or that were defined in the ADPFs judged by the STF.”
Then, Luiz Felipe Maia, Founding Partner of Maia Yoshiyasu Advogados, used lotteries to exemplify issues related to taxation. According to him, this happens due to the lack of knowledge of the regulators about the activity. “There is a great lack of knowledge about the operation that has an influence on the values. So, when these figures circulate in the media that the sports betting industry moves I don't know how many billions the numbers are as varied as possible. Here in Brazil we will have a tax rate and costs that practically make the operation unfeasible. We saw the law being created in 2018 with taxation that did not work because it was based on the volume of bets. In 2021, with a lot of effort from the industry, a lot of convincing, we managed to change that to the GGR base, which is betting less prizes and ended up with a value that made sense,” said Maia.
“So I wanted to show you the relevance of this and leave a message that is important for everyone in the industry: we have to have a dialogue with the regulator to explain how our business works,” he added.
For Udo Seckelmann, Head of Gambling & Crypto at Bichara e Motta Advogados, gaming regulation processes evolve very slowly, focused on revenue; however, he looks favorably on the fight against off shore operators.
“We are still giving classes and lectures specifically commenting on the collection by the Government and it is not able to take the next step of effective regulation of the market. Brazil, if it could, would not regulate sports betting or any game of chance, but it is concerned with raising funds and we only discuss raising funds. But, today I will praise the point of regulation. The provisional measure that will probably pass addressed a very crucial point, which is how to combat the gray market.”
“So, what good a provisional measure brings are three measures: blocking unlicensed sites in Brazil, banning payment providers from providing services to these betting sites and publishing advertising and sponsorship in Brazil of unlicensed operators. These are some of the effective measures that follow the best international practices; but, I confess that I am curious to see if our regulator will be able to put it into practice.”
On the other hand, Roberto Brasil Fernandes, Senior Lawyer at Brasil Fernandes Advogados, highlighted the advances in the regulation of lotteries, reinforcing that these movements brought more legal security to the operators of the activity. “There is an expectation of legalization of casinos and bingos, but there is no longer any expectation of legalization of lottery modalities, which already have a portfolio of six modalities with different products, including fixed-quota sports betting and instant modalities that can be explored even in self-service terminals. This is the novelty, legal security for several lottery products. Brazil has never been a country without a game offer: bet, draw and prize, but informality has always happened on a large scale.”
“With the novelty of legal certainty, the market will now be channeled to the regular environment, which will comply with the law. In the informal environment, you do whatever you want and are subject to criminal, civil and tax sanctions. In the formal environment, you comply with the law.”
Returning to the subject of regulation, Rodrigo Alves, Head of Content at Eightroom and President of the Brazilian Sports Betting Association (ABAESP), highlighted the lack of concern for the bettor, which is the most important part of the process and can lead to dangerous paths. “One of the reflexes of excessive taxation will be precisely a lower quotation. This will necessarily make the bettor look elsewhere. That market that wants to curb the manipulation of results or greater protection or non-taxation in cases of gains that light up their two thousand reales there does not come out. So this channeling rate is not that difficult to achieve as long as good concepts are followed.”
“Following good models is very difficult, because it requires technical expertise, quality and the will to make it happen. When you think about revenue and thinking that the revenue will be putting everything on the back of the bookmaker and consequently the bettor, in fact Brazil will be much more trying to punish those who bet where they shouldn't be than feeding or encouraging betting on the correct place.”
Finally, Edson Kikuchi, Associate Senior Consultant at 2S Consultoria, called on the entire industry to come together to make a big move, take advantage of the sector's growth and achieve regulation. “So, I wanted to pose a challenge to you, the perfect legal instrument does not exist. We have been discussing the legality of the jogo do bicho for seventy-five years and even it has improved. We are sitting waiting for what? The perfect world? Everyone is looking at their own navel. From the moment everyone leaves it there to start looking at a common goal, things will move forward. Each one has to open a hand of a piece. Payment companies, control management, operations, if everyone does not contribute, we will be here meeting in a legal discussion, seeking legal perfection, but it will not be on the other side,” he concluded.
Source: GMB
