Zona de Azar Brazil – EXAME Brazil: Interview with Francisco Manssur

Brazil.- September 10, 2024 www.zonadeazar.com  Government should limit bets for Bolsa Família beneficiaries, says former Finance Secretary.  Francisco Manssur talks about the challenges of regulation, how he sees the sector in 2025 and the need to combat gambling addiction.

Almost a year after the approval of the bill that regulated sports betting in Brazil , one of the “fathers” of the process sees that one topic was left out of the regulation: bets for beneficiaries of social programs. In an exclusive interview with EXAME, Francisco Manssur , former Secretary of Prizes and Bets at the Ministry of Finance and one of those responsible for articulating the approval of the project, stated that, as it was designed, the regulation of the sector will allow data to be cross-referenced. This would make it possible to assess whether those receiving Bolsa Família or the Continuous Cash Benefit (BPC) are betting and limit these people’s access to the so-called bets .

“This is an important discussion. We will have a lot of information about gamblers, and it may be necessary to discuss whether beneficiaries of social programs, such as Bolsa Família or BPC, should have access to the betting market,” he says. “It is not difficult to cross-reference these people’s data, and it may be the case to create a limitation to protect these people, given their socioeconomic profile. This is an issue that can be improved in the future.”

A lawyer since 1998, Manssur has always worked in the area of ​​sports law. He has worked with clubs, companies and sports entities. In 2015, he proposed to Senator Rodrigo Pacheco the creation of the law on the Football Corporation (SAF). His close relationship with Gabriel Galípolo, former executive secretary of the Treasury and nominated to take over as president of the Central Bank, was decisive in his becoming an advisor to the Executive Secretariat of the Ministry of Finance. There, he led the drafting of the betting regulation and worked with Congress to get the bill approved.

Earlier this year, Manssur stepped down from his position because he felt he had “fulfilled his mission” and to settle political disputes over control of sports betting authorizations. Today, the lawyer is a partner at the law firm CSMV Advogados.

In addition to suggesting improvements to the sector, the former Finance Secretary talks about the challenges of regulation, how he sees the sector in 2025 and the need to combat gambling addiction.

See the full interview with Francisco Manssur

How did the need to regulate betting arise?

Betting was legalized in 2018, but the 2018 law itself required regulation within two years, with a two-year extension. This regulatory gap caused a series of problems. One of the issues that caught the government’s attention during the transition was the fact that, without regulation, there was no way to tax. So, imagine all economic segments being taxed, food, industry, and this segment, not. We didn’t even have access to much data, because there was no regulation, there was no information. But we heard numbers that said this segment moved R$150 million and didn’t pay R$1 in taxes. And we discovered that it was much more than that. Without regulation, you can’t control advertising, you can’t combat money laundering, you can’t implement effective policies to combat addiction, which is something very important and that was growing a lot. So, I spent a year and a half at the Ministry of Finance.

And how was this process within the Ministry?

I held almost 500 meetings with all segments. This was very intense in the first half of 2023. I also studied the cases of other countries, because the Ministry of Finance had practically nothing on the subject. There was no history, no study, especially because the previous government pretended that this was a “non-issue”. In the second half of the year, in addition to continuing to listen to the market, I also had a lot of dialogue with Congress.

How do you see the future of this regulated market? How many websites should there be in Brazil next year? 

We had 113 requests for authorization. If each of these requests goes ahead and is approved, each one could have three brands, that is, almost 300 or 400 betting sites in Brazil. When we were at the Treasury, we mapped almost 1,000 domains that were offering bets in Brazil. With the regulation, the number could double.

Do you see room for mergers and acquisitions in this market? 

Now, until the authorizations are issued, the market will adjust internally. After that, there will be a new movement in the market, with mergers and acquisitions. It is possible that the number of 113 will decrease a little due to these mergers, but we also feel that new companies are interested in entering the market and may submit new authorization requests.

The market sees that the regulation was restrictive. Do you agree? 

Regulation is restrictive because it has to be. We need to ensure that companies have the financial means to guarantee the prizes and that they are incorporated in Brazil. When they are authorized, they will have to pay a premium of R$30 million.

Regarding the issue of games like Tiger and Airplane, you mentioned that the problem is not the game itself, but the way it is sold. Could you explain better?

If you advertise these games fraudulently and tell people that by playing Tiger or Airplane they will get rich, you are committing a crime because of the advertising. I always like to give a somewhat controversial but interesting example. If I take an influencer and have him say: “I’ve been drinking nothing but Coca-Cola all day and look how strong I am, how I’ve lost weight and become healthy”, he will influence millions of people to go on this so-called “Coca-Cola diet”, which will be very harmful to them.

So it’s a matter of propaganda? 

Yes. The problem is not Tigrinho or the little plane , the problem is the message. It’s the way it’s sold. What we saw a lot and we’re going to combat with regulation are real frauds. People programmed their cell phones to make videos showing: “In 10 minutes, I won R$25,000.” This was a fraud, a misleading advertisement, which must be combated. This can be done in relation to Tigrinho , the little plane , sports betting, or even in relation to other situations, such as someone saying that they opened a page on Instagram and in 10 minutes they won R$25,000.

And what about combating gambling addiction, how can regulation help?

The central point of regulation is responsible gaming. We prohibit the use of credit cards for betting, which is essential, since a compulsive person could bet unlimitedly. Betting is only allowed with available funds in the account, which limits the risk. We also prohibit entry bonuses, which are often used to attract new bettors, something that can encourage addiction. We create rules so that operators offer policies to combat addiction and are responsible for the way they advertise bets, limiting misleading advertisements that promise easy riches.

Do you think the government has done enough to combat addiction or is there more to be done?

We held four meetings with the Ministry of Health and proposed the creation of a working group to address the issue of gambling addiction. It is important that the Ministry of Health, which has the technical capacity, lead this dialogue with health professionals. It is not the role of the Ministry of Finance to lead this conversation, but we have been working to ensure that the issue is addressed appropriately. I hope that this working group is being created now. In addition, part of the tax revenue from gambling goes to the Ministry of Health, which can use this money to implement public policies and treat gambling addiction.

And what about beneficiaries of social programs, such as Bolsa Família, do you see any need to restrict their access to betting?

I believe this is an important discussion. We will have a lot of information about gamblers, and it may be necessary to discuss whether beneficiaries of social programs, such as Bolsa Família or BPC, should have access to the betting market. It is not difficult to cross-reference these people’s data, and it may be the case to create a limitation to protect these people, given their socioeconomic profile. This is an issue that can be improved in the future.

Regarding the judicialization of the sector, do you believe there will be many questions?

I believe so. The market is very competitive, and it is natural that legal challenges will arise regarding the authorizations granted. This is part of the democratic process. The judiciary will establish precedents and create greater legal certainty for the sector. This is positive and is part of the maturing of the market. Of course, some actions may be reckless, but the judiciary has mechanisms to deal with this.

And what was the reason for your departure from the Ministry?

On February 23, I spoke to the minister about my departure. I asked to leave because I felt that my work was complete, that the partnerships were well underway, and I thought it was time to return to the market. First, I had to comply with the quarantine, so I consulted the Ethics Committee about this. I was released in May, and on June 5, I started working at CSMV Advogados, which is a very important firm in the area of ​​sports law.

Was your departure just because you thought your work was done?

Yes, I thought my work was done. Even though the ordinances are still in progress, the market will only be effectively regulated next year. Of course I am curious to see how it will work, but there are some important aspects to be considered. First, there was a discussion with the Ministry of Sports about who would grant the authorizations. The Ministry of Sports was demanding this, and the Speaker of the Chamber of Deputies was defending this process.

Was it a political issue? 

According to the minister and the executive secretary, this issue was somewhat hampering the minister’s relationship with the Chamber. I told the minister that I saw no legal basis for the Ministry of Sports to issue the authorizations, because the law expressly stated that it was the Ministry of Finance. But if this discussion was really creating a problem, perhaps changing the person could help resolve the issue, and that is what happened. With my departure, the discussion evolved and reached a consensus.

Editó: @_fonta www.zonadeazar.com