Zona de Azar Brazil – Brazil: Senate Committee Backs Sports Betting Bill Updates by Maia Yoshiyasu Advogados

Brazil.- 19th October 2023 www.zonadeazar.com On October 18, 2023, the Rapporteur of the Sports Commission (“Comissão do Esporte”, “CESP”) at the Federal Senate, Senator Romário presented the respective report for the approval of Bill of Law 3,626/2023 (“Projeto de Lei”, “PL”) which regulates fixed-odds sports betting (“apostas de quota fixa” or “AQF”) and Law 5,768/1971 and respective amendments, which regulates the free distribution of prices, also known as the Commercial Promotions Act (“Lei de Promoções Comerciais”, or “LCP”).

As follows Maia Yoshiyasu Advogados, prestigious business law firm based in São Paulo, has prepared an informative on the proposed updates:

Incorporated Amendments: the presented amended bill incorporated the proposed amendments No. 14- U, 48-U and 61, with the following content:

 Amendment No. 14-U and Amendment No. 48-U: These amendments modify the PL to allow the Ministry of Finance to grant authorization for the operation of fixed-odds betting for a duration of up to 5 (five) years, instead of just 3 (three) years (article 5, section III).

 Amendment No. 61: This amendment modifies the PL to specify that advertising and promotion of bets will be directed at the adult audience, ensuring that children and adolescents are not the target audience (article 16, section III).

Reject Amendments: all the other 78 amendments were rejected by the Rapporteur.

Additional Amendments Proposed: additionally, 3 (three) additional amendments were proposed:

Amendment No. 1:

Establishes the maximum limit for the value of the fixed grant at R$ 30,000,000.00 (thirty million reais), with a limit of up to 02 (two) commercial brands to be exploited by the legal entity on its electronic channels per authorisation act.

Amendment No. 2:

o Proposes the alteration in the destination of social contributions. The overall mandatory social destinations on the GGR – i.e., the revenue obtained after the payment of prizes and the Brazilian income tax – was maintained at 18% (eighteen percent), but, pursuant to this suggested amendment, are to be redistributed among the following taxes:

(i) 2% for social security contribution;
(ii) 1.82% for the education sector;
(iii) 2.55% for the National Public Security Fund (FNSP);

• 68% for the sports area (of which 1.13% goes to clubs and athletes that assign the rights to use their names, brands and symbols for the dissemination and execution of AQF);
• 4,30% for the tourism sector
• 0,5% for the Ministry of Health;
• 0,15% for different civil society

  Amendment No. 3:

• Proposes the addition of two paragraphs to art. 14 of PL No. 3.626, of 2023, regarding specific restrictions on football betting matches to prevent match-fixing. According to the added paragraphs:
• 3: Establishes the prohibition of betting on individuals to ensure the integrity of sports competitions and related bets.
• 4: “individual events” include corners, throw-ins, red and yellow cards. Bets involving these specific events would be prohibited, removing incentives for players, referees, or others involved professionals to manipulate these events and to influence the outcome of bets.

Outlook

 The CEsp report is currently being analysed by their members in a session scheduled for today, October 18, 2023, with a request for review by Senator Leila Barros.

Requests 22, 23, and 25/2023 have been approved, allowing for off-agenda inclusion for the organization of a hearing to discuss the regulation of sports betting. The likely date for this is estimated to be next Monday, October 23, 2023, with the guests yet to be appointed and under the chairmanship of Senator Eduardo Girão.

After the approval, the text still needs to be analyzed by the Commission of Constitution and Justice (CCJ).

In the meantime, the PL is concurrently being reviewed by the Committee on Economic Affairs (CAE), with Senator Ângelo Coronel serving as the rapporteur. In this committee, 20 amendments are being proposed, with a public hearing scheduled for tomorrow, October 19.

Subsequently, it should also be subject to examination by the CCJ (Committee on Constitution and Justice).

Following this, the PL is expected to be brought to Senate floor, with the analysis anticipated to be completed by November 11, 2023.

Edited by: @MaiaDigital www.zonadeazar.com