In order to encourage discussion about the legalization of the gambling market in Brazil, journalist Luiz Carlos Prestes Filho is promoting several interviews with politicians, specialists, lawyers and businessmen working in this area.
Specialist in Cultural Economy and Local Economic Development and author of several books on the topic, Prestes Filho recently spoke with the president of the Brazilian Association of Casinos, Bingos and Similars (ABRABINCS), Olavo Salles da Silveira.
According to the “Tribuna da Imprensa” portal, the businessman addressed several topics about the relevance of Brazil by opening the possibility of counting on casinos in cities with up to 50 thousand people, since these establishments could move and leverage the entire local economy.
Check out Olavo Salles da Silveira’s interview
Luiz Carlos Prestes Filho: ABRABINCS has, for years, carried out an intense work with the Brazilian authorities for the regulation of money betting games administered by the private sector. Did the Covid 19 pandemic hinder the process?
Olavo Salles da Silveira: ABRABINCS was born from the effort that was to make the market’s relationship with the constituted authorities viable. At the beginning, we tried to adjust the existing legislation, we tried to best serve the interests of the bingos that were authorized to operate. However, due to the lack of specific tax legislation for the operation of gambling, we face difficulties. For example, you cannot mistake revenue for betting. In this way, since our foundation we have worked with the competent bodies. Initially, in the adjustment of the existing authorization.
But when the activity was no longer legal, when there were changes to the Sport Statute, which became known as the Maguito Law, the articles referring to authorization became invalid. From that moment on, bingo became a lawful but unregulated activity. This was not the understanding of the Public Prosecutor’s Office, who, ignoring the fact that there was no repristinatory effect in Brazilian law, they conducted the process in such a way that the Bingos became a misdemeanor.
Since then, ABRABINCS has focused its activity on the search for its own and adequate legislation for cash gambling managed by the private sector. With the pandemic of COVID 19, in the years 2020 there was a paralysis in the referrals on the subject in the Chamber of Deputies, in the Senate of the Republic and in the ministries of Tourism, Sports and Finance.
Luiz Carlos Prestes Filho: Does ABRABINCS defend the legalization of all games? Would bingos and casinos be priorities?
Olavo Salles da Silveira: ABRABINCS defends the regulation of all types of money betting games. It does not make sense to have legislation that favors one type of game and does not offer regulations for another type. Even because there is a demand for a prohibited modality, which has active entrepreneurs, they will cross imposed barriers. We understand that gambling is a lawful activity and should be regulated.
Today, the modality of electronic games has grown exponentially. In 2020, we saw the expansion of the universe of people who seek to challenge luck in networks. The restrictions imposed by the social isolation of the pandemic brought about changes that we must recognize, study and, of course, adapt to.
Luiz Carlos Prestes Filho: In the Chamber of Deputies, in recent years, there has been an appreciation of the theme Casino Resort. Does this path open concrete perspectives?
Olavo Salles da Silveira: After the visits to Brazil by the American gambling entrepreneur, Sheldon Gary Adelson, who has an estimated personal fortune of more than 28 billion dollars and owns large casinos in Las Vegas and Macau, we realized that the theme started to be more accepted by the authorities. He spoke with ministers, governors and mayors showing that cash gambling offers important support for the development of economic tourism activities.
Thus, the topic began to receive special attention in the Chamber of Deputies. Parliamentarians understood that games, being part of the tourism production chain, could be regulated. As president of ABRABINCS, I do not accept this referral, because Brazil has the conditions to offer casinos for leisure, entertainment and culture, as well as bingos. I agree that Resort Casinos can contribute to the development of municipalities that have a tourist vocation, but our vision is that we have to broaden horizons, democratize access to games.
What Sheldon is looking for are two casinos in São Paulo and two in Rio de Janeiro. His vision is to place these big cities in Brazil as a tourist destination for games. This does not solve it. The model proposed by the American businessman has consolidated addresses in the world.
Those who want to do game tourism go to Las Vegas and Macau, where there is an infrastructure that will never be implemented elsewhere. The model we propose for Brazil is that of Urban Casinos, like those we find in England, which are smaller casinos, without accommodation, which are a complement for those who are touring in that city. I’m talking about the leisure or business tourist who, at night, having a chance, goes to play. This favors the hotel chain as a whole.
To place a Resort Casino in Campos de Jordão would be to favor a single group. Now, placing an urban casino in Campos de Jordão would bring more benefits. A small urban casino or bingo, in a city with more than 50 thousand inhabitants, would benefit the entire hotel chain, as well as restaurants, bars, theaters, shopping centers, fairs, museums and cultural centers. It would generate more job opportunities and expand business opportunities. Also, it would good for Brazilian investors.
A casino resort that requires investments of between 3 or 4 billion dollars, would not play this role. No Brazilian entrepreneur will be part of this, because those who have these values will invest in the segment in which they operate. As no Brazilian is active in the casino segment, he will not participate. Which is correct from a macro point of view. The Game Economy Productive Chain, regulated and strategically designed, can contribute to the development of Brazil.
Luiz Carlos Prestes Filho: What is the order of priorities for installing regulated game infrastructure in Brazil? Do Rio de Janeiro, São Paulo and Belo Horizonte offer better conditions than other Brazilian cities?
Olavo Salles da Silveira: It all depends on which game model will be installed. When it comes to thinking about resort casinos, we understand that Sheldon will seek a license to operate two or four Resort Casinos as close to metropolises as São Paulo, Rio de Janeiro and probably a central city in the northeast or the capital, Brasilia . But if we seek to act more democratically, if the project is to promote leisure, entertainment and culture, we can think of all the major cities in Brazil that have a vocation for tourism.
Luiz Carlos Prestes Filho: What are the Bill Drafts, related to games, that are currently being processed with force and representation in the National Congress?
Olavo Salles da Silveira: More than 50 projects sought the gambling regulation in the National Congress in the last 30 years. There are projects that were born out of the personal interest of one or another deputy. There are parliamentarians who unarchived old projects to resume the debate on the subject in the legislature. But those who had the most impact were born out of the collective effort in the struggle to regulate our activity. These have been developed in the past five years.
But deputy does not approve bill, deputy votes, accepts or does not accept provisional measures. It is very rare when a law is passed from a group initiative. For example, the projects that seek regulation, which have some chance of approval, are those that a state minister puts under his arm and conducts the process with the government’s seal. For this reason, the project that has the best chance of being approved is the one that regulates Cassinos Resort.
On the other hand, the Supreme Federal Court (STF), which for years took positions contrary to the gambling regulation recently adopted positive initiatives. It gave the right of state lotteries to regulate all types of games. This occurred in December 2020. In my opinion this means a significant change in the STF. As we have a process, at the same supreme level, which disputes whether the Criminal Misdemeanor Law, the law that banned casinos in 1946, whether or not it was upheld by the 1988 Constitution, I have the impression that the STF can judge, in this case, in this process, the gambling liberation.
The Law of Criminal Misdemeanors is an outdated tool. Therefore, there is a great chance that regulation will happen via the STF. This happening, would force the federal government to go out in a race to regulate the gaming market in Brazil. Regulating all modalities. Therefore, today it is more likely that regulation will happen through the STF than through a draft law of the National Congress.
Luiz Carlos Prestes Filho: The Brazilian States and Municipalities suffered a great negative impact with the Covid 19 pandemic. Could the regulation of cash gambling contribute to the collection for public coffers?
Olavo Salles da Silveira: Several towns would benefit from the regulation of the games, but it depends on the model that will be approved. Approving only Resort Casinos, let’s think about five or six towns that would have long-term results. Approved urban casinos, any town with a tourist vocation would benefit. But what is growing, because of the pandemic and because of the scientific and technological revolution, also due to the relationship between people increasingly happening via the internet, are the electronic games.
But these will specifically benefit the cities where these high-tech companies are located. In Brazil, for sure, there won’t be many cities. Then, a concentration happens again. The tendency is for gambling to collect for the Union and not for states and municipalities. These would benefit from the installation, the operation, the jobs generated. Gambling origin taxes are almost always from the Union.
Luiz Carlos Prestes Filho: What is ABRABINCS ‘work agenda for the next year of 2021?
Olavo Salles da Silveira: ABRABINCS’s line of work today is to monitor what happens in all political and business spheres. We seek to dialogue with the major institutional forces that issue opinions and decisions on the activity of gambling money managed by the private sector. We work by holding technical meetings, congresses and seminars in an effort to create understanding. We do not believe in the effectiveness of lobbying.
The straight and open debate is always better, we seek to form an opinion. We try to bring information to the public, inviting the authorities to visit countries where gambling is regulated. But international seminars were wiped off the agenda in 2020, those in 2021 are compromised and fairs in 2022 have difficulties in scheduling dates.
Here in Brazil, the company Clarion Events, which stood out in the realization of major gambing events, planning to create a fair on the subject in the future, ended its activities. It closed the agenda around the world. Clarion preserved only the ICE event, which takes place every year in London. But, for example, the last major gaming event they held in March 2020. Therefore, these activities of meetings, congresses and business fairs are activities that will have to be rebuilt.
Luiz Carlos Prestes Filho: Does ABRABINCS plan to continue its participation in international events on the subject? What are the most relevant events today?
Olavo Salles da Silveira: The Brazilian Gaming Congress (BGC) was a significant step in establishing a more open debate format about the game regulation effort in Brazil. Especially because, as I said above, the lobby next to the congressmen is very worn out. The country is very divided. Many benches are not guided by what is best for the country, but by the struggle for power. So, I see a Manacheistic posture within the National Congress.
Lobbying in legislative houses has not evolved. The path must be one of constant clarification with public and private agents. He has to become aware of his responsibilities. Clarion Events’ work at the BGC congresses was for the executive to embrace the cause. But, even within the executive, we have divisions because of dogmatic religious positions and ideological prejudices.
Gambling is under pressure from everyone. We need to make it clear that non-regulation creates space for misdemeanors and illegal activities. Not bringing benefits to society. I would like to highlight that all the events organized by Clarion Events marked the last five years. Unfortunately, they are discontinued due to the departure of this company from Brazil.
Luiz Carlos Prestes Filho: Does the federal executive, especially his ministers, suggest the possibility of regulation?
Olavo Salles da Silveira: The Ministry of Tourism has been working with this focus, but it is a portfolio that has no weight to conduct an agenda of this magnitude in the legislature. All the last four ministers who passed through there embraced the concept that the casino is a support for tourist equipment. But they have not been successful within the group that decides.
The Ministry of Finance, with an agenda to create resources, has been performing more significantly. But it faced a resistance that was the corporatism of Caixa Econômica Federal (CEF). A dispute that has been won, which allows us to think at this moment that, for economic interests, the Treasury can lead the issue alone.
Although, in my understanding, the judiciary is that structure that can return the regulated game to the country, due to the acceptance of Direct Action of Unconstitutionality (ADIN), not recognizing the acceptance, by the 1988 Constitution, of the law that closed the casinos in 1946.
Luiz Carlos Prestes Filho: How many years have you, Olavo Salles da Silveira, worked for the regulation of gambling in Brazil?
Olavo Salles da Silveira: My involvement with gaming activities began when Lei Zico, nº 8.672 of July 1993, authorized the opening of Bingos in Brazil. My focus was to create an employers’ association, in order to be able to dialogue with the union organization of workers in the activity. But I realized that we had a lot more activity. To adapt all legislation on the subject.
We had to complement it. We had federal legislation, practically structured by the Rio de Janeiro State Lottery (LOTERJ), copied in other states, and which delegated the regulation to the finance departments of all states. But many of these bodies have had no interest in regulating. Especially because the collection generated at the time by the Bingos would be from the towns or the Union.
In other words, that legislation was born without the monitoring of the constituted authorities, without caution and that was extremely negative. We are left without guidelines and parameters, without limits and inspection. To this day, I am in charge of ABRABINCS but, in recent years, it has been weakened, because Bingos’ activity is prohibited and when practiced it is carried out by organizations that do not seek regulation.
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