Why are there no casinos in Brazil?

Highlight , Opinion I 17.02.20

By: Elaine Silva

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Ronaldo Nóbrega*

The reason there are no casinos in Brazil is quite simple: it is a criminal offense to operate gambling games. But this only applies to private entities. For Caixa Econômica Federal (a Brazilian bank), not only is it legal, but it is guaranteed a monopoly over this commercial activity. The offense is a kind of 'less serious crime'. In the case of the prohibition of betting or gambling, this rule came from a series of Decree-Laws from the 1930s and 1940s and was incorporated into the 1988 Constitution.

Obviously, it makes no sense to consider a conduct illegal, but for the State to have the right to commit it while the average citizen does not. For this reason, the PHS (Humanist Party of Solidarity) filed a Claim of Non-Compliance with a Fundamental Precept (ADPF) in the Supreme Federal Court (STF) seeking to restore the right of any individual to legally engage in betting.

In this request, the PHS states that Decrees-Law No. 3.688 of 1941 (Law of Criminal Offenses) and No. 9.215 of 1946 offend Fundamental Rights and Freedoms, the Principles of Economic Order, Free Initiative (CF, art. 1, IV) and Free Competition (CF, art. 170, caput, IV and sole paragraph) and violate rules of Direct Exploitation of Economic Activity by the State (CF, art. 173).

The Federal Public Prosecutor's Office (MPF) issued a poorly substantiated report on the subject that failed to consider the economic potential of this activity. According to the Minister of Tourism, Marcelo Álvaro Antônio, 93% of the 20 richest countries in the world have legalized gambling. In Punta del Este alone, Brazilians represent 70% of the total number of gamblers at the Conrad Casino. Furthermore, cities like Las Vegas receive approximately 6,8 million foreign visitors annually, which is equivalent to the total number of international visitors Brazil receives each year.

There has already been progress on this issue with the legalization of sports betting. Law No. 13.756 of 2018 legalized sports betting where the bettor knows how much they will win. The legalization of fixed-odds sports betting opened the first step for private enterprise to explore the game. The trend is that the state monopoly on gambling will be broken, even more so at a time when Brazil needs to foster economic activity and generate jobs.

In this sense, the full Supreme Court should bring the discussion to the forefront and promote public hearings with experts on the subject and with civil society participating in the debate. The Supreme Court has the autonomy to decide and is not obliged to follow the narrow understanding of the Public Prosecutor's Office. It is time for Brazil to attract investment; casinos are generally grandiose constructions that employ many people from construction to operation. The taxes generated would certainly be greater than the monopolistic collection of Caixa Econômica Federal (a Brazilian bank) and would be divided among the states of the Federation, many of which are in a chaotic financial situation.

(*) Ronaldo Nóbrega is a journalist and columnist for Coluna Política and a contributor to Justiça em Foco, where the article was published.


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