With the great evolution of the online betting market in Brazil, it would be impossible to prevent new partnerships between sports entities and bookmakers from emerging, especially in football, the most successful segment in the country.

Now, after several closed sponsorship agreements, partnerships with influencers and other types of business, the State has arrived to ‘disrupt’ the natural evolution of the sports betting sector, as it has notified Brazilian clubs, federations and even a renowned broadcaster, because of this type of relationship with betting companies.

The Conjur website recently published an article – by Thuan Gritz and Pedro Guilherme Gurak – that portrays the main reasons for this intervention in the sports betting market.

Check out the full news on sports betting below.

In recent days, the Ministry of Justice and Public Security, through the National Consumer Secretariat (Senacon), has notified [1] the clubs that compete in the Brazilian Championship Series A and B, 13 federations and Rede Globo television, giving to those notified ten days to send copies of advertising and/or sponsorship contracts with companies that offer sports betting services, which was the first of the 16 items listed throughout the document.

The essence of the notification presents as the “main reason” the absence of regulation and the development of the activity without any control. Item 2, for example, already outlines in its text that the concern is due to the growth of the branch in the country, even though, as stated, there is no authorization for the operation:

“Item 2: Motivation is due to the high number of sponsorship contracts between football entities reported and companies in the sports betting sector that often carry out unauthorized activities in the country through websites.”

The apparent concern of the agency, permissa venia, presents a veritable semantic gymnastics to request documents without any specific reason, enumerating mere conjectures to justify the false bluff (i.e. what it really seeks with the request). In other words, it makes a generic request to more than 50 institutions without making any distinction between them.

It so happens that the motivation highlighted in item 2 goes against the previous guidelines of the State itself, because, as we have already presented in detail in a previous article [2], the entrepreneurs acted under the perspective that brought a little security, registered in the Process / Protocol No. 08200.02.0170/2017-12, within the scope of the Federal Police.

The definition by the Department of Studies, Legislation and Opinions of the PF suggested understanding “in the sense of the inapplicability of Brazilian law to games of chance implemented by pages located abroad”, exactly the opposite of what is now suggested – without any explanation about the contradiction of the Brazilian state.

And the worst. The opinion received by the general coordinators and the general internal affairs department on 11/28/2017 was intended precisely to “avoid the opening of unnecessary judicial police procedures”.

Obviously, a country can change its understanding over the years, a factor that, for that, requires systemic and perspective coherence. At this point, Brazil goes a long way.

This is because, between the aforementioned Federal Police opinion and the present notification, Law 13,756/18 was published, dealing with fixed-odds bets from its article 29. In addition, in an opportune topic, it set a deadline for regulation of the sector, which should – according to the law – occur by the end of 2022.

Curious, then, that the very “subject” presented in the title of the Senacon document denominates the bets as irregular, as well as the “concern” with the lack of inspection of a sector, whose regulation: a) does not happen due to political interests and b) is still within the period set by the legislator.

The goal goes beyond concern for the consumer and anyone can see it.

The source of the notification reveals its real interest.

Proof of this is that, specifically in the final part of item seven (7) of the notification, it is highlighted that the initiative for such a desideratum came from an insightful letter sent by the Federal Public Ministry to Senacon, making the investigative purpose of the document clear.

“07. Despite the new type of betting (fixed quota) having been approved by Law No. 13.756/2018, it is not yet in force, since a deadline for regulation has been authorized (autonomy of the law). , the activity has been explored without proper authorization and without any control, inspection or accountability mechanisms, since there is still no regulation required by law, including no rules that mitigate damage to gamblers/consumers, which may, in thesis, to be violating basic consumer rights. This possibility motivated the sending of an official letter from the Federal Public Ministry to Senacon to verify the issue of advertising carried out by the bookmakers.”

In parallel with all this, it was reported that the Attorney General’s Office (PGR) intends to investigate an alleged irregular exploitation of sports betting in the country [3], since it had already been called, along with the Federal Police, by the Ministry of Economy. [4].

Thus, based on what has been aired so far, it is possible to conclude that it all started with the letters sent by the Secretariat for Evaluation, Planning, Energy and Lottery (Secap), which is part of the Ministry of Economy’s portfolio, thus causing the PGR officiate to Senacon, belonging to the Ministry of Justice and Public Security, which finally notified the entities highlighted at the beginning.

What is common in all manifestations is the approach that the sector works without any authorization or supervision, although Senacon justifies the measure based on its mission, which is consumer protection.

Indeed, Senacon’s attributions are delimited in article 106 of the Consumer Protection Code and in article 3 of Decree No. 2,181/97, focusing, in short, on the planning, elaboration, coordination and execution of the national policy of consumer protection and defense. This context is important because it created a scenario of apparent consumer protection bias.

This is clear at least in items 6, 8, 9, 10, 11 and 12, where there is an effort to broaden the legal concept of supplier, in order to reach those sponsored by betting sites, under a questionable pretext about the addiction of those who gamble (gambling) or even address an alleged concern about the gambler’s mental health.

An incompatible reasoning, since it is the State notifying individuals on grounds of concerns that are already included in the draft regulation of fixed-odds betting (Articles 7 to 16 — which deal with various topics related to inspection, conscious advertising and responsible gambling), but the State itself, for various reasons, is inoperative in approving the regulation. An inconsistency that catches the eye.

The key point, however, is released in the middle of the notification. Specifically in item five (5), the purpose of the PGR in requesting support from Senacon is described, notably because, in advance, the Prosecutor’s Office would not have legitimate attributions to access data/information from betting sites based outside the country without judicial authorization or without demanding external cooperation, which would only take effect, obviously, from reasonable indications of the existence of criminal offenses.

The same item expressly mentions financial crimes (?) and apparently describes, without parameters, a theoretical practice of financial pyramids through the websites, forcing the participation of the consumer body without any indication that any of the at least 53 notified have participated in crimes of this nature. It’s as if you want to catch a specific “fish” and cast a huge net to catch whatever comes.

Now, it is important that the content of the topic in question be transcribed, not least because the premises from which the body starts with the illogical conclusion of an alleged economic loss to “society”:

“Item 5. With the ostensible advertising with these companies operating in the country, the number of participants in this market, which is already exponential and will rise more and, consequently, will increase the probability of financial crimes and false high-profit offers in the short term period of time, causing enormous economic damage to society.”

It should be noted: only the sponsored ones were notified, evidencing the intention to reach the betting sites based abroad through a transversal route. It should be noted that the document only mentions the probability of the occurrence of crimes, that is, in order to obtain contractual information from the sponsors, which, in the view of the prosecution body, may be essential for future investigations of economic crimes or to endorse ongoing procedures.

This statement is wide open in item 3, which transcribes Decree-Law No. 3,688/1941 (Criminal Misdemeanors). In fact, in addition to a consumerist concern, what is wanted is to locate possible crimes or misdemeanors in a multi-billion market. The consumer is not and has never been the object of any concern:

“Item 3. The platforms that act as sponsors offer not only the fixed-quota service, but also games of chance, casinos, bingos and virtual slot machines (not authorized in the country — Decree-Law No. 3,688/1941)”

Therefore, for the avoidance of doubt, the outstanding concern with consumers is nothing more than a subterfuge to investigate the sector that moves billions in the world and has been growing in the country, which is why it becomes a clear target of some State agencies.

As the notification itself warns, the sector is still not well understood in Brazil (item 12), remaining in legal limbo due to the inefficiency of the State itself, which does not regulate the activity.

But after all, what does this have to do with advertising contracts signed with clubs, federations and television?

It is not common to notify those sponsored by cigarette companies, liquor companies or even cryptocurrency exchanges (the latter, a sector that is also pending regulation).

In the same way, the dynamics of pornographic sites based abroad, which have the same potential for dependence, despite not being stamped on club shirts, have never been investigated.

Why football? Why this branch?

It is a fact that any activity that generates pleasure in human beings can, to some extent, cause addiction. Such concern has already been foreseen in article 33 of Law 13.756/18 [5] (as well as in the publicity chapter of the draft decree) and, in theory, would be directly related to the sponsor’s activity with the consumer, never the sponsored one.

Even so, in a great exegetical effort, from the Pelé Law and the Fan Statute, the sponsored were equated with suppliers, aiming to make them responsible for consumers who use sports platforms for betting. It’s the easiest way to get to contracts, now. And for some investigative bodies, contracts will be — everything indicates — the gateway to huge operations.

In practice, it would be the same as linking clubs and federations to traffic accidents motivated by the use of alcohol, if eventually they were sponsored by companies in the beverage sector.

Precisely for this reason, in the case of misleading or abusive advertising, the responsibility falls on those who sponsor the information (ex vi of article 38 of the CDC). Here, even the minority current that defends the joint liability of the media recognizes that this only occurs through intent or fault. So, how is it possible to recognize any of these modalities in the absence of regulation?

For this reason, it is noted that concern with the correct advertising linked to online betting is an issue to be resolved only through the proper regulation of the sector already mentioned above.

Of two, one: either the term provided for in Law 13,756/18 will be extrapolated (which, given the current political scenario, was already foreseen), or the real concern of the Ministries of Economy and Justice is exclusively to protect the national financial system and all the eminently criminal implications that we have already warned here (reinforcing the cautions suggested in a previous article — Online betting sector in Brazil: the luck is on).

This last reference extrapolates, in our opinion, the competence of Senacon and, at the same time, hides the true motivation for the notification, since the responsibility of advertising vehicles in possible criminal actions of betting sites to the detriment of consumers is highly debatable.

Regrettably, and by all indications, the sector will remain unregulated, while operators, investors and business partners — including influencers — may (and are becoming) targets for large operations, as a result of the state’s own inertia regarding fixed-quota bets.

It’s better not to take any chances