After four years of delay, Brazil’s Ministry of Finance is about to send a Provisional Measure (PM) regulating sports betting to the Civil House (the chief of staff of the presidency.) Sports betting has been legal since 2019, but the law governing it, Federal Law No 13,756, was an empty vessel, lacking regulations.
It could be signed as early as February 27 by President Luiz Inácio Lula da Silva. A PM is a presidential decree with the power of law that lasts 60 days, and which can be extended. It requires approval by Congress to become permanent, however.
The government action may have been prompted by recent scandals such as alleged fight fixing. Some critics feel that the integrity of soccer is also at risk. Some players admit to having been approached by gamblers. This could not only affect individual games but also championships.
Journalist Juca Kfouri’s blog published the news, noting that the lack of regulations and the charging of fees and taxes during those four years meant the government lost $1.16 billion to $ 1.55 billion annually. The PM will detail all requirements that the betting sites must follow.
There was added drama late last year when outgoing president Jair Bolsonaro failed to ratify the regulations, fulfilling a political debt owed to some of his supporters in the last election. However, once he took office, President Lula moved the project forward, especially in light of match-fixing scandals that have come to light and sparked cries for action.
One such call to action came from Luiz Felipe Maia, founding partner of Maia Yoshiyasu Law Firm, who told iGaming Business, “Without regulation, and with such a huge amount of betting operations from offshore, the Brazilian leagues are an easy prey for fraudsters.” He added, “It was a matter of time until it created a series of scandals that could result either in the regulation or the shutdown of the market.”
One new requirement is that sportsbook sites must be based in Brazil. This requirement will make it easier to fight money laundering at the source.
José Francisco Manssur, special adviser to the Executive Secretariat of the Ministry of Finance, told Kfouri that the regulations were created after consulting with the Ministry of Sport, the Central Bank, the Federal Police, the Public Ministry, the Brazilian Football Confederation, the Brazilian Olympic Committee and potential sports betting operators. Manssur was one of the founders of Sociedade Anônima do Futebol (SAF – Football Anonymous Society.)
There are risks involved in using the PM to legalize sports betting. Maia declared, “This is one of the concerns around the process: the government may lose control of the legislative process and the final result may be different from the original proposal.” He added, “The provisional measure may also be used by the congress to expedite the discussions around the legalization of gambling in general.”
