The recent Supreme Court decision regarding bets

On November 15, 2024, the virtual trial of the precautionary measure requested in ADIs 7.721 and 7.723, which challenged provisions of Law No. 14.790/2023, governing fixed-odds betting, was concluded. On that occasion, the monocratic decision of Minister Luiz Fux , which had already partially granted the requested precautionary measures for two purposes, was confirmed:

1. "providing an interpretation in accordance with the Federal Constitution to article 9 of Law No. 14.790/2023, ensuring that the regulations prepared by the Federal Executive Branch specifically provided for in Ordinance SPA/MF No. 1.231, of July 31, 2024, have immediate application, with regard to the aforementioned measures concerning advertising aimed at children and adolescents”; and
2. ""So that immediate special protection measures may be implemented to prevent participation in fixed-odds betting with resources from social and welfare programs such as Bolsa Família, the Continuous Benefit Payment, and similar programs, until the conclusion of the judgment on the merits of the aforementioned direct actions of unconstitutionality."¹.

As can be observed, the essential purpose of the injunction is to prohibit advertising aimed at children and the use of resources from social programs, such as Bolsa Família and BPC – Benefício de Prestação Continuada (Continuous Benefit Payment), in online betting, known as bets. Consequently, provisions of Law 14.790/23 were suspended, based on the need to protect minors and vulnerable families against the financial and psychological impacts of betting.

In his vote, Minister Luiz Fux emphasizes that the statements made at the public hearing on the subject presented evidence of the harmful impacts of gambling on the mental health of children and adolescents and on family budgets, particularly for people benefiting from social and welfare programs, without sufficient protection for these two groups.

Consequently, it would be imperative to adopt measures both to prohibit advertising and promotion of these activities that target children and adolescents, and also to prevent participation in fixed-odds betting with resources from social and welfare programs.

In his vote, Minister Gilmar Mendes also noted the need for a better-developed regulatory framework on the subject, as well as the development of state regulations to protect these vulnerable groups and to mitigate and punish those responsible for manipulations and frauds perpetrated.

It is also necessary to highlight the vote of Minister Flávio Dino, who emphasized, among other issues, the need for prevention of pathological gambling disorders, a mission for which the competence and expertise of the Ministry of Finance would be questionable, resulting in the consequent risk of insufficient protection of fundamental rights concerning the health of the Brazilian population.

As can be seen, the issue relates to the discussion about the role of the State in protecting people, especially vulnerable groups, including those who, like beneficiaries of assistance programs, receive public funds.

Nevertheless, it is important to emphasize that the discussion about gambling transcends vulnerable groups, since there is evidence of harmful impacts even on people who cannot be considered a priori as deserving of special protection. After all, talking about gambling means considering the problem of addiction and its consequences both individually and collectively.

Thus, the question remains whether, even for non-vulnerable people, the State is required to protect them from initiatives that, like bets, can have extremely negative consequences for their lives and for the country's economy itself.

As a recent report by UOL² shows ^, the issue of gambling has become a public health problem, and it can be said that Brazil is experiencing a veritable epidemic of online gambling addiction, with alarming consequences, including those mentioned above:

1. A study by the Brazilian Society of Retail and Consumption (SBVC) in partnership with AGP Pesquisas showed that 63% of those who gamble in the country had part of their income committed to betting, of which 19% stopped shopping at the supermarket and 11% did not spend on health and medicine; and
2. A report released by the Central Bank revealed that beneficiaries of the Bolsa Família program spent R$ 3 billion on sports betting websites in August 2024 alone, equivalent to 21,2% of the resources distributed by the program in that same month.

Another problem with betting has been the drop in consumption and the deleterious impacts on various economic sectors, notably retail ^. In attempting to quantify the losses, B3 ^shows some figures that help to understand the reasons for the impact of betting on the economy as a whole: R$ 23,9 billion was the net spending of Brazilians on online betting in the 12 months ending in June 2024, and 86% of Brazilians who place sports bets online are in debt.

According to the most recent data, in four years the amount of resources invested by Brazilians in betting has doubled, reaching R$ 68,2 billion in 12 months, a volume that represents 0,62% of GDP, 0,95% of total consumption and 1,92% of the entire Brazilian wage bill. For this reason, betting is beginning to transform the national economy, since spending on bets already represents the equivalent of 76% of leisure and culture expenses for classes D and E and 5% of food expenses for the poorest ^families.

It is in this context that the important discussion arises regarding the need for broader protection of individuals and the economy itself, as well as the role and legitimacy of the State for this purpose.

Of course, those with a more libertarian mindset will tend to argue that people should be free, and the main consequence of this is the need for them to be responsible for their choices, with the State having no role in interfering in this process. Those with a more interventionist mindset, on the other hand, will tend to emphasize the State's role in protecting people from themselves when faced with choices that could cause significant harm to themselves and, as in this case, also to society and the economy itself.

However, the principle of freedom typically invoked by libertarians needs to be put into perspective, given the limitations of people's rationality and the effects of addiction, circumstances that can completely undermine truly autonomous decision-making processes in the case of gambling.

As Daniel Kahneman explains , ^⁶ although much is at stake in the debate between libertarians, represented by the Chicago School, and behavioral economists, freedom is not one of them, as it is an uncontested value. The problem is that life is more complex for behavioral economists than for staunch proponents of human rationality, for whom rational agents do not make mistakes and freedom has no cost whatsoever.

The fact is that human beings have numerous limitations in rationality that can influence their decisions. Therefore, it would be legitimate for the State to intervene in certain situations, especially to protect people from ill-informed choices or choices not based on minimal elements of rationality. After all, by doing so, the State would be protecting people's freedom and not unduly restricting it.

Such concerns become even more legitimate when considering psychological addiction and the numerous marketing strategies, undue persuasion, and even manipulation that can be used, which is further evidence to argue that people in these states are not properly exercising their freedoms.

In this way, the Supreme Court's decision only initiates an important and necessary debate about the role of the State in protecting people from themselves. When we are talking about decision-making processes in which the very autonomy of individuals is compromised, we have good reasons to justify state protection, even more so when the effects of individual decisions also bring harmful effects to society and the economy.

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