Brazil is one of the few countries in which the sports betting market still remains without regulated operations, which reveals a huge inconsistency since national legislation defines it as a public service whose operating architecture could facilitate relevant social interests.
In an effort to discipline the matter, Law 14,790/2023 was recently published, consolidating several legal provisions concerning the exploitation of sports betting and assigning responsibility for regulating the application of the provisions of the law to the Ministry of Finance.
It turns out that, despite the necessary issuance of the long-awaited Regulation of Law 14,790/2023, of December 29, 2023, the Ministry of Finance has been acting (irregularly) based on the previous regulation arising from Normative Ordinance MF 1,330/2023, of October 26 2023.
In fact, the Ministry of Finance's website announced that it had held a meeting on January 10, 2024 with SERPRO and “with around 200 representatives of fixed-odd betting companies who expressed interest within the deadline established in Normative Ordinance MF 1,330, 2023.”
According to the news, the intention of the meeting was to present “guidelines for carrying out tests” with “the objective of preparing betting systems for the necessary adaptations to obtain authorization” and making a point of highlighting that “only companies that expressed interest as per the Normative Ordinance MF 1,330, of 2023, and who sent a specific email for the testing phase, will be able to participate.”
As can be seen, what can be seen from the news published on Gov.br is that the Ministry of Finance is materializing what is contained in articles 26 and 29 of the aforementioned ministerial order, which dealt with the “prior expression of interest”, the wording of which established:
Art. 26. Legal entities interested in granting authorization for the commercial exploitation of fixed-odd betting in the national territory MAY present a prior expression of interest to the Ministry of Finance, within a period of up to thirty days, counted from the publication of this Ordinance.
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Art. 29. Companies that fully comply with the provisions of this Chapter WILL HAVE PRIORITY in the analysis of their requests for authorization for the commercial exploitation of fixed-odd bets, when the deadline for submitting the request opens.
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However, such procedures do not have a legal basis that authorizes them. This is because, among other reasons, the provisions of Ordinance 1,330 that established a priority order linked to the “prior expression of interest” are incompatible with the wording of the recent Law 14,790/2023, which determines that the analysis of applications will observe the chronological order of their protocol, otherwise let's see:
Art. 10. The administrative authorization procedure will be processed electronically, and, during its analysis, the records will be restricted from access to the interested party and their attorneys.
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§ 2 Except in the event of suspension or extension of deadlines, due to insufficiency, incompleteness or inconsistency of the documentation presented by the interested legal entity, the analysis of the applications
will observe the chronological order of their protocol.
Now, when considering the regulation and the law, we must understand that the latter occupies a separate and precedence place in legal imperativeness. Hence, no administrative act (such as regulatory ordinances) will be carried out against the express text of the law, due to the principle of hierarchy of norms. In other words, in the conflict between law and regulation, the law always prevails.
Furthermore, a meeting to deal with public interests, but restricted to a group of individuals, in addition to not complying with the text of the recent Law 14,790/2023, defies the basic principles of public administration of legality, impersonality and publicity ( CF/88, article 37). It would be better for the Ministry to opt for a public hearing, open to all interested parties who wish to contribute to achieving the purposes intended by the law.
Even so, we must note the recognized effort of the Ministry of Finance to regulate, as quickly as possible, a matter of significant national prominence. And the criticism made here ends up being merely motivated by a concern regarding the validity of the acts and procedures carried out.
The same concern remains regarding the ministerial intention published on news channels that “the registration window [for requests for authorization to operate] must be opened twice a year, and will remain open for a few weeks, the company that misses the period or If the request is denied, it will become illegal in Brazil.”
Here, we must conceive that such a restriction on the authorization procedure, if actually carried out by the Ministry of Finance, will also compromise the legality of the administrative acts adopted, considering that the new Bets Law (article 9) is expressly establishing the possibility of requesting authorization may be requested at any time by the interested legal entity, and the Ministry is therefore responsible for ensuring the means to guarantee compliance with the legal command, keeping the authorization procedure permanently open.
Jhonatas Mendes and Gedecy Medeiros
Lawyers and consultants in regulatory law for lottery games. Jonathas Mendes is president of the OAB/MA Gaming Law Commission and Gedecy Medeiros, general secretary of the Commission.
