The government has issued a notice, and Caixa confirms it will suspend payments to the COB (Brazilian Olympic Committee).
The Brazilian Olympic Committee's (COB) greatest fear has been confirmed. On Monday, the Special Secretariat for Sport officially announced the loss of certification that guaranteed the entity the receipt of funds from federal lotteries – the main source of revenue for Olympic sports. It also notified Caixa Econômica Federal, which informed that the transfers will be suspended until the situation is resolved. The lottery funds were guaranteed by the Piva Law. They represent almost 90% of the COB's revenue. The estimated revenue for 2019 was R$ 250 million..
“This Monday (8), the Ministry of Citizenship informed by means of an official letter that the Registration Certificate granted to COB expired on April 5, 2019 and that the absence of the Certificate of Debts relating to federal tax credits and the Union Debt was verified. Therefore, based on the law, CAIXA will suspend the transfer of resources from Federal Lotteries destined for that entity until the aforementioned situation is regularized”, says an official note from Caixa sent to Globo.
The situation at the COB became complicated last Friday, when The certification of compliance with the Special Secretariat for Sport (formerly the Ministry of Sport), linked to the Ministry of Citizenship, has expired.The document is necessary to guarantee the receipt of public funds. The Brazilian Olympic Committee was unable to renew its certification because it is listed as a debtor to the National Treasury, which prevents the issuance of a Certificate of No Debt (CND). The reason is old debts of approximately R$ 191 million from the defunct Brazilian Sailing and Motorboat Confederation (CBVM), which was under COB intervention between 2006 and 2012 following allegations of corruption and mismanagement. According to the Attorney General's Office of the National Treasury (PGFN), the Committee and the current Brazilian Sailing Confederation (CBVela) are jointly responsible for the debt.
The legal dispute surrounding the former CBVM is being processed in the Federal Regional Court of the 2nd Region (TRF 2), in Rio de Janeiro. The COB (Brazilian Olympic Committee) has achieved some victories in court, but last February, a request for a stay of execution was denied, and it is listed in the National Treasury's debtors' book in two lawsuits, with a total debt of R$ 61,6 million.
COB's line of defense
The Committee's main argument for trying to resolve the situation immediately is that receiving the funds allocated by the Piva Law would not require a tax clearance certificate (CND). According to the COB (Brazilian Olympic Committee), the funds from federal lotteries are not public funds.
– The lack of a tax clearance certificate does not prevent the transfer of funds from the Agnelo-Piva Law. This funding comes from the law. When you play the Mega-Sena lottery or the sports lottery, a portion of these funds goes directly to the COB (Brazilian Olympic Committee). It doesn't go into the public treasury, it doesn't go into the federal budget. It has to come directly, regardless of any other document – Sampaio explained.
In an official statement, the Sports Secretariat informed that without certification, the Committee is prevented from formalizing agreements or receiving funds from the department. However, controlling lottery funds is not within the Secretariat's responsibilities.
As the administrator of federal lotteries, Caixa Econômica is responsible for allocating the percentage of revenue that belongs to the Committee. Also through a statement, the public bank informed that it will suspend the transfers based on Law 9.615/98.
Secretariat vetoes certification without CND (Certificate of No Debt).
Despite lacking the CND (Certificate of No Debt), the COB (Brazilian Olympic Committee) submitted a request for renewal of its certification to the Special Secretariat for Sport last Tuesday. The deadline for completing the analysis is 20 consecutive days, ending on April 22nd.
The COB (Brazilian Olympic Committee) had been trying to maintain the validity of the certificate during the renewal review period, which was rejected by the Government. The ordinance regulating the matter recommends that entities submit their documentation 40 days in advance, precisely to avoid the suspension of payments between the expiration date and the renewal process.
The Sports Secretariat also confirmed through an official statement that the CND (Certificate of No Debt) is an indispensable document for the renewal of the certification. The agency also communicated that governance actions are being carried out to address the outstanding issues of the COB (Brazilian Olympic Committee), however, without detailing the measures.
In addition to arguing that federal lottery funds are not public property, the COB (Brazilian Olympic Committee) is also fighting in court to be removed from the passive side of tax enforcement proceedings against the former CBVM (Brazilian Volleyball Confederation), which would remove the entity from the list of debtors to the National Treasury and could regularize the entire situation.
According to Rogério Sampaio, general director of the COB (Brazilian Olympic Committee), a possible cut in lottery funding would inevitably impact the preparation of Brazilian athletes for the Pan American Games in Lima, which begin at the end of July.
– Our preparation will be weakened if these resources are cut. These are training programs abroad, competitions that help maintain the rhythm, so that the athletes reach their peak at the Pan American Games.
The event in Peru is crucial for the Olympic cycle of several sports. In other words, the damage caused by a possible budget cut at this time could also have a direct effect on Brazil's participation in the Tokyo 2020 Olympics.
– The number of participants (in the Pan American Games) may decrease. Imagine in a delegation of 495 athletes, how many professionals are added to that number? The Brazilian delegation is one of the largest in the Pan American Games. Without these resources, our participation in the Pan American Games and the Olympic Games will be impacted. I reiterate that the lack of the CND (National Debt Clearance Certificate), the interruption of the Agnelo-Piva Law, strongly impacts us, but we do not agree with the suspension of fund transfers due to these problems – concluded Sampaio.GloboEsporte.com – Fabrício Marques, Flávio Dilascio, José Maurício, Marcelo Cardoso and Thierry Gozzer – Brasília and Rio de Janeiro)
