The legalization of games in Brazil is a recurring issue and was addressed in the column by Fausto Macedo, in Estadão. Lawyers Thiago Lima Breus and Ricardo de Paula Feijó pointed out how the issue has come back into vogue lately due to economic difficulties and the Federal Supreme Court (STF), which defined the Union’s monopoly on the exploitation of lottery modalities as unconstitutional.
This year, there is great expectation around the games market. Three topics will be assessed: the new state lottery service, the completion of the sports betting regulatory process and the release of “gambling” games in general.
The exclusivity of exploitation of the Federal Government’s lotteries was overturned at the end of last year, in judgment of the STF. Thereafter, the states gained the competence to also create and carry out lottery services in their territories.
Several states are already starting studies and approving measures to create these types of games. The tendency is for countless states to design and implement their lotteries. An important question is: what limits do states have to regulate their lottery services?
Trouble between states and the Union
Although they can organize their lotteries, the Union has the competence to create rules. This was defined by the Supreme. Therefore, state governments need to follow Union laws to establish their lotteries, while the Union has no interest in granting them much autonomy. At this point, it is possible that some trouble will occur.
This debate may still cause problems for the long-awaited regulation of sports betting in Brazil. Sanctioned in 2018, the bets have gone through a regulatory process for over two years. As this service is also classified as a lottery type, initially, nothing prevents states from exploring this activity in their territories.
This action, however, may undermine the Federal Government’s intention to grant a restricted amount of betting concessions and receive high amounts for it. With the concessions, the Union aimed to collect significant amounts that would be offered by players interested in having a betting concession to operate in the country.
However, if there is no longer this exclusivity of the Union for the exploitation of bets and does not provide a monopolized segment to companies, this may prevent the collection of these concessions.
Other factors also appear from this problem between States and the Union, such as inspection and limits for each operator. Since the states could only release exploration within their respective limits. This has more complicated issues when taking into account the sports betting sector, as it already happens in Brazil without regulation.
Release of games in Brazil may occur by Congress or STF in 2021
The resolution is not easy and probably requires inter-federative cooperation. Adjustments between the state and federal governments for the joint exploration of the betting market could be a way out, capable of offering advantages for both governments and the people.
The concession idea can be made more flexible, providing the entry of more interested in the national scenario. You can think of exchanging a model with few operators for an open system, similar to an accreditation, which allows greater growth in the segment and, consequently, greater economic and social advantages.
This year’s situation is also adequate for the release of so-called “games of chance” in general, both via the National Congress and through STF intervention. In Congress, there are many proposals under discussion. And a great manifestation of deputies and senators in favor of the liberation of the modalities, mainly, due to the potential of job creation and taxes.
In addition, the agenda will be discussed at the Court on April 7. Thus, the STF can decide whether the ban on the exploitation of games envisaged since the 1947s is constitutional or whether it violates the fundamental right to freedom and free enterprise.
If the STF decides that it is not constitutional, the practice will be released throughout Brazil, regardless of the enactment of law. In this way, the moment of games and lotteries is very promising, only, equally, challenging.
This year, the data were released so that the authorities can take advantage of the possibility and, finally, put into effect a regulation that offers the greatest possible competition in this market, in order to enable the broad growth of the activity and allow a responsible gambling regime. Thereafter, the benefit will be shared by everyone.
