Betting regulation: what experts think about the main points of the MP text

ESTADÃO published a report that evaluates the federal government's proposal to regulate the sports betting sector in Brazil. Dr. Matheus Puppe, partner at Maneira Advogados, was interviewed to comment on the topic.

Betting regulation: what experts think about the main points of the MP text

By Rodrigo Sampaio
(Photo: Sportingbet)

Proposal prevents managers, athletes and bookmaker operators from gambling and places the Ministry of Finance as the regulatory body for the process

The text of the Provisional Measure which regulates betting sports in Brazil was delivered to President Luiz Inácio Lula da Silva (PT) amid the great repercussion of the investigations by the Public Ministry of Goiás (MP-GO) into a fraudulent scheme involving sports betting on games in series A and B of the 2022 Brazilian Championship and this year's Paulistão and Campeonato Gaúcho. This is an amendment to Law 13,756, sanctioned in 2018 by Michel Temer.

The proposal will take immediate effect if signed by the PT member, but will need to be approved by Congress to become law. Sought by Estadão, experts comment on the measure and evaluate some of the main points of the text. One of the new features is the participation, direct or indirect, of “a person who has or may have any influence on the outcome of a real sports-themed event that is the subject of the fixed-odd betting lottery”. This includes managers and athletes, in addition to refereeing.

Mariana Chamelette, Attorney at the São Paulo Football Court of Sports Justice and vice-president of the Brazilian Institute of Sports Law, understands that the change is “fundamental” to maintain sporting integrity. “The general competition regulations of both the São Paulo Football Federation and the CBF already provided for this prohibition, which must now be regulated”, he explains. “Although the MP does not expressly provide for this, FIFA prohibits Sports stakeholders, that is, people who can exert influence on matches, such as managers, from holding any stake in betting operators”, he highlights.

Owners, administrators, managers and employees of bookmakers themselves are also prohibited from betting, as well as people under 18.

The Provisional Measure also establishes that bookmakers are prevented from acquiring, licensing or financing the acquisition of rights to sporting events to broadcast, distribute or reproduce them on any platforms by any means or process. According to Mariana, this point is necessary for the text to actually be effective. “This section is placed so that it is interesting for the operator to obtain a license and, in addition, there is supervision and prohibition of platforms that are not licensed.”

“Preserving the integrity of sport must be one of the government's priorities and, therefore, the rules must be especially strict and attentive to people who may have some degree of influence over the outcome of matches”, says Eduardo Diamante, specialist in Sports Law, from Carlezzo Advogados.

The Goiás Court made 16 defendants, including seven players. The cases are also investigated by the Federal Police, which opened an investigation as ordered by the Minister of Justice and Public Security, Flávio Dino, following a request from the CBF. Groups of gamblers co-opted athletes to carry out actions on the field, such as deliberately receiving cards, in exchange for a financial advantage of up to R$100,000.

The text provides that, if there is evidence of match manipulation or similar fraud, the Ministry of Finance may determine the immediate suspension of bets and the withholding of prize payments, as well as “other restrictive measures designed to avoid or mitigate the consequences of practices that violate the integrity of sport”.

“The issue of subordinating these suspension measures to the Ministry of Finance, although it is a classic practice, with an example in Europe, does not make me sure that the body will have this arsenal to monitor and apply the penalties than an authority separated from the Ministry, like a gaming regulatory agency”, ponders João Vitor Kanufre Xavier, master in financial and tax law from USP (University of São Paulo), partner at Galvão Villani, Navarro, Zangiácomo and Bardella Advogados.

“We have successful examples in Nevada, in the United States, which started with the body linked to the Treasury, but later became a different regulatory body, specialized and with instruments to carry out this type of inspection.”

Money at stake

The government expects to raise R$12 billion to R$15 billion with the measure. According to the Ministry of Finance, ministries will be able to issue ordinances with rules to create mechanisms that prevent and curb cases of manipulation of football matches. The Minister of Justice, Flávio Dino, is committed to dealing with the matter with an iron fist. He used the word “repression” against those involved in the scheme and blocking of assets.

“The implementation of the sports betting bill has the potential to generate a considerable source of revenue for the government and create new jobs, while also presenting significant challenges in terms of regulation and consumer protection, as it exposes the market to new risks not previously considered. Firstly, it is important to understand that sports betting is not just a leisure activity, but a multi-billion dollar industry, which already happens by default in Brazil”, says Matheus Puppe, lawyer specializing in new technologies and partner at Maneira Advogados.

“Each of the points in the text reflects a careful and considered approach to the regulation of sports betting in Brazil. They aim to maximize economic benefits while minimizing the potential risks associated with the activity,” it says.

The money collected from fees and taxes will be allocated to areas such as public security, basic education, sports clubs and social actions. According to the Treasury, of the total collected, 2.55% will go to the National Public Security Fund; 0.82% goes to basic education; 1.63% is allocated to sports clubs; 10% will go to social security; and 1% goes to the Ministry of Sports.

https://www.estadao.com.br/esportes/futebol/texto-medida-provisoria-regulamentacao-apostas-esportivas-especialistas/