At the eleventh hour, on December 30, 2023, Law 14,790/23 was sanctioned by President Luiz Inácio Lula da Silva, marking a significant milestone for the sector, particularly as the final legal framework before the effective regulation of fixed-odds betting (FOB).
However, it cannot be ignored that the final text left a series of unresolved gaps or, at the very least, without the necessary depth for a complete understanding by interested operators. This includes aspects such as guidelines for the implementation of mandatory corporate policies (money laundering prevention, responsible gaming, integrity, and prevention of match-fixing), as well as the administrative authorization procedure itself.
Therefore, it is now the responsibility of the Ministry of Finance to issue ordinances that provide better contours to the principles and precepts established in the legislation under review, in order to bring greater clarity to these issues.
One of the most discussed points during the bill's proceedings has not yet been sufficiently clarified. This is due to the widespread speculation between the Senate vote and the return of PL 3626/2023 to the Chamber of Deputies, regarding the supposed inclusion of online casinos in the legal framework, based on the expression: virtual events of online gaming (art. 3, inc. II).
Fixed-odds betting and virtual events of online gaming.
Indeed, Article 2 of Law 14,790/23 presents interpretative concepts of the law, establishing, for our interest, what constitutes a bet, fixed odds, online gaming, and virtual events of online gaming:
"Art. 2 For the purposes of this Law, it is considered:
I - bet: an act by which a certain amount is put at risk in anticipation of obtaining a prize;
II - fixed odds: a multiplication factor of the amount wagered that defines the amount to be received by the bettor, in case of winning, for each unit of national currency wagered;
(...)
VIII - online gaming: an electronic channel that enables virtual betting on a game in which the result is determined by the outcome of a future random event, using a random number generator, symbols, figures, or objects defined in the rule system;
IX - virtual event of online gaming: an event, competition, or act of online gaming whose result is unknown at the time of the bet;"
At first glance, when reading the expression "random number generator, symbols, figures, or objects defined in the rule system," everything suggests that this is a description of what characterizes some online casino or iGaming games (considering the broadest sense of the term, including any online game from sports betting to casino games: table games, slots, and crash games).
However, even though the established concept may hint at the possible approval of other games of chance, it is essential to observe that Article 3, due to technical misunderstanding, legislative oversight, or even intentionally, determines that bets on virtual events of online gaming must be fixed-odds, as follows:
"Art. 3 Fixed-odds bets under this Law may have as their object:
I - real events of a sports theme; or
II - virtual events of online gaming."
In other words, a literal interpretation indicates that fixed-odds bets under this Law may have virtual events of online gaming as their object, unlike regular bets or casino games, where in fixed-odds, the multiplier (ODD) is known at the time of the bet. Therefore, in my humble judgment, the literalness of the law could suggest that games in which the bettor does not know in advance the multiplier in case of winning would be prohibited.
Government Statements
In this regard, recently, in a Globo Online article1, the Special Advisor to the Executive Secretariat of the Ministry of Finance, José Francisco Manssur, stated that games like "aviãozinho" and "tigrinho" will not be regulated, "since they do not fit into fixed-odds betting – where the prize amount in case of victory is known."
Moreover, in the same interview, the frontrunner for the position of National Secretary of Games and Sports Betting made it clear that the aim of the Law is not to legalize games but to protect people and achieve tax justice through the collection and allocation of these funds in health, education, and basic sanitation.
This statement aligns with information from the Government itself, as on January 5, 2024, the Senate's news portal2 stated that: "authorization for bets known as online casinos also remained in the text."
The issue is that "aviator" and "fortune tiger" are, respectively, crash and slot games, available on most iGaming platforms. For the sake of legal certainty, it is reasonable to question which games are covered by the legislation and the scope of the concept "virtual events of online gaming," especially when the legislation includes them under the umbrella of fixed-odds betting – which will only be solidified in future ordinances.
So, at least for now, based on the literal interpretation of Law 14,790/23 and the aforementioned statement, it is not possible to affirm the supposed legalization of online casino games, as reported by various individuals and portals.
In other words, the saga continues!
Pedro Gurek and Yohann Sade
Attorneys at Sade & Gritz law firm
