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Brazil’s prosecutor general is reportedly preparing to file a constitutional challenge in order to overturn Law 14.790, which regulates online betting.
The prominent Folha de S. Paulo newspaper reported on Friday morning (November 1) that the Brazilian chief federal prosecutor is expected to file a s0-called direct action of unconstitutionality (ADI) with Brazil’s Federal Supreme Court in the coming days.
Two Brazilian lawyers consulted by Vixio GamblingCompliance were taken by surprise by the report and were still unclear about how seriously such a legal challenge and its ramifications should be taken.
Paulo Gonet, whose official title is Prosecutor General of the Republic, will reportedly file the constitutional challenge based on the position that Law 14.790 could be harmful to the economy by encouraging reckless spending.
He is also apparently not convinced that there are sufficient safeguards against fraud and match-fixing.
The regulation of Law 14.790 has been at risk since September, when a series of published studies highlighting online gaming’s supposedly harmful effects began to flood Brazilian media.
Once those floodgates were open, it quickly became a narrative that the gambling industry and its supporters could not quell.
Reports began to appear in mainstream media outlets blaming increases in divorce on gambling, alongside ominous statistics that poorer Brazilians were spending their welfare funds on bets.
The final consequences of the fallout remain unknown and unpredictable, although Gonet would join other leading public figures and politicians in calling for a change of direction.
Last week, Brazil Senate President Rodrigo Pacheco told an audience in London that Brazil should explore “tougher rules and try to reverse the scourge that this type of gambling has become in Brazil, making people vulnerable, who even use their social benefits to gamble”.
“If you can’t reverse this reality, if it’s not something lateral in society, if it's in the lives of all Brazilians in this way, there’s no other way but to ban it,” Pacheco added.
The legality of Law 14.790 is already being challenged before the Federal Supreme Court, with a two-day public hearing scheduled on November 11 and 12 on a high-profile legal case brought by the National Commerce Confederation (CNC).
The CNC represents leading retail businesses in Brazil and has cited some of the same constitutional arguments that Folha de S. Paulo reported Gonet to be preparing.
Separately, the Supreme Court is trying another case brought by six states and the federal district of Brasilia against specific provisions within Law 14.790 that limit advertising of state lotteries to the residents of the state and prevent private operators from operating in more than one state. Justice Luiz Fux has issued an injunction against those provisions until the case concludes.
Additional reporting by James Kilsby.
