SBC News Brazil moves forward on project to modernise land-based gambling laws  

Brazil moves forward on project to modernise land-based gambling laws  

The Senate of Brazil has advanced plans to modernise laws governing the gambling disciplines of land-based casinos, bingo, horseracing, and the sale of jogo do bicho (instant win games).

On Wednesday, the much-delayed Bill No. 2,234/2022 was approved by the Senate’s Constitution and Justice Committee (CCJ), securing 14 votes in favour and 12 against, advancing a federal project to modernise land-based gambling laws.

Following two years of delays in its mediation, Bill No. 2,234/2022 will progress to the State Plenary for further revisions of how land-based gambling modalities can be applied to federal law.

Abreu revives marginalised Bill  

The passage of the Bill is credited to Senator Irajá Abreu (PSD-TO), who picked up the project from the shadows, stating: “After studying this issue in depth, it is impossible that the whole world is wrong and only Brazil is right in not addressing and not establishing criteria and limits with this so important, necessary, and present project in the lives and routines of all Brazilians.”

The CCJ Rapporteur Abreu stated that Brazilian lawmakers could not ignore a project that “could reach R$ 100 billion and generate about 1.5 million direct and indirect jobs in the country.”

For land-based casinos, the project seeks to reverse the 1946 Decree Law of President Gaspar Dutra that banned casinos from operating in municipalities and districts.

As such, the Bill carries the original modalities of former deputy Renato Vianna (MDB-SC) to allow “the establishment of land-based casinos in tourist locations or integrated leisure complexes in the country, imposing a limit of one casino per state and in the Federal District.”

Federal rules to grant municipal autonomy on gambling venues

Exemptions on land-based casinos are allowed for the larger states of Rio de Janeiro, Minas Gerais, Paraná, and Amazonas that will be allowed two casinos, and São Paulo allowed three properties.

The project liberalises rules on bingo venues to operate in ‘designated locations,’ with one establishment allowed per municipality and additional ones based on the population size of a town or district. 

Bingo licences will be sanctioned by local municipalities, with authorization valid for 25 years, renewable, and requiring a minimum capital of R$ 10 million.

The project will apply new federal rules on the sale of jogo do bicho, as SBCNoticias reports that within “each state and the Federal District, one legal entity per 700,000 inhabitants may be accredited to operate activities.”

Changes will allow for states and federal districts to operate independent “jogo do bicho” vendors, who must ensure the legal requisites of operating a “modality for 25 years, renewable for another 25, and must prove a minimum fully paid-up capital of R$ 10 million to obtain the licence.”

The project calls for an overhaul of Brazil’s laws related to horse racing and the modernization of turf venues, a mandate that should be overseen by the Ministry of Agriculture.

As it stands, the Bill proposes multiple protective measures, in which land-based gambling should be allowed for “only individuals with full civil capacity can place bets, excluding those insolvent, over-indebted, or involved in debt restructuring in the past two years.”

The text denies public agents involved in gambling, administrators, and members of gaming house controlling groups the ability to participate in gambling.

Likewise, the project calls for the establishment of a ‘National Register of Prohibited Persons’ (Renapro) to monitor those barred from betting, and gaming houses must verify entrants against the register.

Safer gambling duties see the bill determine that a “National Policy for the Protection of Gamblers and Bettors must be established to ensure game honesty and prevent pathological gambling”.

The mandate states that at “least 80% of casino and bingo revenue must go to prizes (40% for “jogo do bicho”), and operators cannot offer loans or promotions to consumers”, and that Land-based gambling advertisements cannot target children or portray gambling as a path to success.”

Taxes applied to a new regime will see prizes over R$ 10,000 incur a 20% withholding tax. For businesses, new taxes include a Gaming and Betting Inspection Fee (Tafija) and the Contribution of Intervention in the Economic Domain (Cide-Jogos).

The framework will allow for States to administer taxes generated from land-based gambling to municipal projects promoting tourism, sports, culture, and various social initiatives.

States and Municipalities must enforce strict regulations to prevent money laundering and terrorism financing, prohibiting cash bets and requiring all transactions to be recorded in a government-accessible system. Licensed venues must allocate 80% of casino and bingo revenues (40% for “jogo do bicho”) to prize payouts.

Evangelical Caucus demands reforms

Though approved for its next phase, the bill faced an immediate challenge from the Evangelical Caucus of the Senate, as members detailed that the project could not be sanctioned without guarantees on minimising gambling risks, including addiction.

The Caucus is reported to seek amendments curbing the project’s remit, in which gambling “should be excluded in municipal districts where crime rates are highest.”

Meanwhile, observers believe that the project will likely undergo several revisions, as the Bill’s original text by former deputy Renato Vianna references modalities drafted in the 1990s. 

Bets is a separate affair… 

Bill No. 2,234/2022’s progress will be carried separately to Brazil’s imminent launch of a federal sports betting marketplace (Bill No. 3,626/2023), under the approved Bets framework, a mandate overseen by the Ministry of Finance and the Secretariat of Betting and Prizes (SPA).

Brazil’s government maintains its schedule to launch the Bets market by 2024, in which the SPA has fulfilled key ordinances related to IT securities, payment rules, and data requirements.

The final SPA ordinances on safer gambling, market conduct, crime prevention, and advertising duties are expected to be published by the end of July as  Brazil aims to launch the regulated Bets market by 2024, ensuring a “comprehensive framework for responsible and secure gambling for all national consumers”.

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