Brazil's Sports-Betting Provisional Measure Receives Over 200 Amendments

August 2, 2023
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More than 240 amendments have been submitted to Brazil's Congress to revise the government's emergency legislation to regulate sports betting, with the most notable seeking to restrict advertising, impose a blackout period for offshore operators and even regulate casino games.

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More than 240 amendments have been submitted to Brazil's Congress to revise the government's emergency legislation to regulate sports betting, with the most notable seeking to restrict advertising, impose a blackout period for offshore operators and even regulate casino games.

Romário, the legendary FIFA World Cup champion who is now senator for the state of Rio de Janeiro, submitted three proposed amendments prior to a July 31 deadline for members of the Senate and Chamber of Deputies to request changes to the so-called provisional measure on sports betting.

One would outlaw betting on individual actions such as yellow cards and corner kicks in games to avoid match-fixing.

“The possibility of betting on such events ... has been the basis for enticing athletes, since isolated events in a match do not attract as much attention and are much easier to manipulate,” the former Brazil and FC Barcelona star wrote in justifying his proposed amendment.

Federal deputies Paulo Azi and Ricardo Ayres also submitted similar amendments, which would also forbid betting on individual actions including yellow and red cards, corner kicks and fouls.

Romário also rallied against advertising in another proposed amendment, saying that Brazilian football players have “involuntarily become poster-boys for these companies, when they wear the shirts of these clubs with their brands on them”.

The amendment would limit advertising on television and radio to between the hours of 9pm and 6am, and prohibit advertising during games, on team paraphernalia or within sports stadiums themselves.

A separate amendment submitted by deputy Bandeira de Mello suggests the same advertising hours.

Advertising and bet types are just two topics addressed in the slew of proposed amendments, which will all be considered by a joint committee of senators and deputies being formed to review the provisional measure and determine whether it should be approved, changed or allowed to expire after a 120-day period.

In an apparent bid to protect unnamed Brazilian interests, deputy Júnior Mano is proposing a Netherlands-style blackout period through an amendment that would require international online operators who have been operating prior to 2023 to wait for a period of time before being granted their licences, based on how long they have been in the grey market.

Under the proposed amendment, any operator that has been active in the Brazilian market since 2019 without paying taxes would have to wait 12 months from when the provisional measure becomes law to be granted a licence, with the blackout period being reduced down to just a three-month wait for any company that has been operating in Brazil only since 2023.

Meanwhile, at least one lawmaker wants to use the provisional measure on sports betting as a vehicle for regulating a far wider range of gambling activities in Brazil.

Senator Angelo Colonel in his amendment suggests legalising all games of chance and casinos at resorts, as is already proposed in separate legislation that was passed by the Chamber of Deputies last year and is still awaiting approval in the Senate.

Other amendments would authorise online lottery courier services and guarantee licences for sports betting for Brazilian racetracks.

Meanwhile, deputy Newton Cardoso, a prominent supporter of expanded gambling, is one of several lawmakers proposing amendments to reduce the government's proposed 18 percent headline tax rate on gross sports-betting revenue.

Under Cardoso's amendment, that rate would be reduced from 18 to 11 percent, with other lawmakers similarly seeking adjustments in the way that player winnings taxes and other business taxes are applied in the context of fixed-odds sports betting.

Cardoso wrote in the justification for his amendment that Brazil’s various other local and social security taxes put the true tax rate closer to 30 percent than the UK's 15 percent, which had previously been cited as an inspiration by the Brazilian government.

The Brazilian Institute of Responsible Gaming (IBJR), a newly formed association representing leading operators, issued a statement on Monday (July 31) highlighting that fact.

“What also worries companies in the sector is the government's attempt to promote the narrative that 18 percent represents the total Brazilian tax burden and that it will be similar to that of England, a country considered a reference for the sector around the world.

“This version of the facts generated a certain embarrassment, since many of these companies, some of which are publicly traded, operate in England and know that this is not true,” wrote the association, whose members include Flutter and bet365, among others.

Andre Gelfi, the president of the IBJR and a managing partner at Betsson, said that with an 18 percent rate, plus additional corporate taxes, “the Brazilian tax burden will be at least 350 percent higher than the English one in the way it was presented.”

Under parliamentary rules, Congress has 120 days to review the provisional measure from the date that President Luiz Inácio Lula da Silva signed it on July 25.

If amendments are adopted by the joint Senate and Chamber committee, President Lula can decide whether to accept or reject them, but he cannot make further changes to the text once it has been approved by Congress.

Another possible outcome, meanwhile, is for Congress to simply let the provisional measure expire without approval.

The Chamber of Deputies also has the option of legislating for sports betting via a separate bill introduced last week by the government and which would be considered independently by both houses of Congress.

Additional reporting by James Kilsby.

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