Ordinance 1.475, which prohibits websites that do not apply for a license at the Secretary of Awards and Betting is unconstitutional, in the opinion of Paulo Horn, president of the Gaming Commission of the OAB/RJ. In a legal opinion, he states that "the measure violates the principle of legality, the hierarchy of norms, and the limits of regulatory power." The lawyer recommends that the Ministry of Finance "reassess its position and seek legislative modification to ensure compliance with the Constitution."
As expected, the market for sports betting and online gaming woke up this Tuesday (17) concerned about the measure taken by the Secretary of Awards and Betting of the Ministry of Finance, which prohibits the operation of betting sites from October 1st without authorization or that have not requested the application with the federal government.
Ordinance 1.475 defines that bets can only operate with prior authorization to be issued by the agency itself.
From October 1st, companies that did not request authorization from the Secretary of Awards and Betting will be classified as illegal until their operation is freed by the Treasury. Betting sites that operate in Brazil without authorization will be subject to the penalties provided by law, which provides fines of up to R$ 2 billion per infraction.
Those who requested the authorization, but were not yet operating, will have to wait to start operations in January — if they manage to get the release by the ministry and meet all the requirements.
Paulo Horn, president of the Commission of Sports Games, Lotteries, and Entertainment of the OAB/RJ, studied the ordinance and points it out as unconstitutional by anticipating the adaptation period of the betting houses.
According to him, “the measure violates the principle of legality, the hierarchy of norms, legal security, and the limits of regulatory power”.
The lawyer recommends that the Ministry of Finance “reassess its position regarding the anticipation of the deadline and seek the necessary legislative modification to ensure compliance with the Constitution, ensuring stability and confidence in the norms that regulate the betting sector”.
Legal opinion
Analysis of the unconstitutionality of Ordinance SPA/MF No. 1.475/2024 in relation to Law No. 14.790/2023.
I. Introduction
This opinion aims to analyze the unconstitutionality of Ordinance SPA/MF No. 1.475, dated September 16, 2024, which anticipates the deadline established by Law No. 14.790/2023 for the adaptation of betting houses, setting it on October 1, 2024, instead of December 31, 2024, as determined by the legislation.
II. Legal analysis
Principle of legality
The principle of legality, enshrined in Article 5, item II, of the Federal Constitution, establishes that "no one is obliged to do or not do anything except by virtue of law". This principle is reinforced by Article 37 of the Constitution, which determines legality as one of the pillars of public administration.
The anticipation of the deadline for the adaptation of betting houses, established by the ordinance in question, contradicts this principle, as it modifies a legal provision without due legislative authorization.
The Supreme Federal Court, in various decisions, reaffirms the importance of the principle of legality. In RE 596.468/SC (Rel. Min. Ayres Britto, 05/14/2009), the STF emphasized that “the principle of legality is the corollary of the Rule of Law and the submission of the Public Administration to the law, preventing any state act that exceeds legal limits”.
In the same vein, in ADI 1.923/DF, (Rel. Min. Celso de Mello, 04/03/2003), the STF emphasized that administrative legality means that public agents can only act according to the law. In this judgment, it was clear that "it is not lawful for the Public Power to issue acts that transgress the limits set by the legislation".
The Public Administration is rigidly bound to the law and the principle of legality, forming one of the pillars of the Democratic Rule of Law, preventing administrative acts from creating obligations or restricting rights without due legal provision.
These decisions reinforce the idea that the Public Administration cannot innovate or restrict rights and obligations outside the limits established by law.
Hierarchy of norms
The Constitution, in its Article 59, establishes the hierarchy of norms, placing ordinary laws at a higher level in relation to administrative acts and infralegal norms, such as ordinances.
Law No. 14.790/2023, by establishing a deadline for adaptation, provides legal security to the operators of the sector.
Ordinance SPA/MF No. 1.475, by anticipating this deadline, despite the just concern, disrespects this hierarchy, resulting in blatant unconstitutionality.
According to José Afonso da Silva, "the hierarchy of norms is a fundamental principle of the legal system, which guarantees the prevalence of the superior norm over the inferior" (SILVA, José Afonso da. Curso de Direito Constitucional Positivo. 2020). The STF, in ADI 4.874 (Rel. Min. Gilmar Mendes. 09/27/2012), has already pronounced on the normative hierarchy, declaring that "administrative acts cannot alter or suppress rights guaranteed by law, under penalty of violation of the legal order".
Legal security
Legal security is an essential principle that ensures predictability and stability in social and economic relations. The change of deadlines through an ordinance generates insecurity, as the operators of the sector who prepared to comply with the legally established deadline face a scenario of uncertainty. The STF has already pronounced in the sense that "legal security is a necessary condition for the stability of social relations" (STF, ADI 2.135, Rel. Min. Gilmar Mendes. 12/06/2006).
In a more recent decision, in the context of ADI 6.793 (Rel. Min. Ricardo Lewandowski. 08/05/2020), the STF reaffirmed that “abrupt and unpredictable changes in the rules applicable to a certain sector compromise legal security, negatively affecting the confidence of citizens in the norms that govern their activities”.
This jurisprudence applies to the case at hand, where the anticipation of the deadline through an ordinance harms normative stability.
Limitations of Regulatory Power
Although the Ministry of Finance has the competence to regulate the activity of betting, this power is limited by existing legislation.
The anticipation of the deadline established by Law No. 14.790/2023 exceeds the limits of regulatory power, characterizing a usurpation of legislative competencies, which are exclusive to the Legislative Power.
Alexandre de Moraes teaches that “the function of the regulator must be to implement and detail the norms, respecting the guidelines already established by law” (MORAES, Alexandre. Direito Administrativo. 2018). The STF, in the judgment of ADI 4.162 (Rel. Min. Marco Aurélio. 02/14/2019), declared unconstitutional a normative act that exceeded the regulatory power, stating that "regulation cannot innovate in the legal order, under penalty of usurpation of the legislative function".
III. Conclusion
In view of the above, it is concluded that Ordinance SPA/MF No. 1.475, by anticipating the deadline for the adaptation of betting houses, is unconstitutional. The measure violates the principle of legality, the hierarchy of norms, legal security, and the limits of regulatory power.
It is recommended that the Ministry of Finance reassess its position regarding the anticipation of the deadline and seek the necessary legislative modification to ensure compliance with the Constitution, ensuring stability and confidence in the norms that regulate the betting sector.
Paulo Horn
OAB/RJ 68.386
Founding partner of Paiva & Horn Advogados Associados. President of the Commission of Sports Games, Lotteries, and Entertainment of the OAB/RJ, Member of the Brazilian Association of Political and Electoral Law - ABRADEP and of the Constitutional Law Commission of the OAB/RJ. He held the positions of administrative and financial director, chief legal advisor, and vice-president of the Lottery of the State of Rio de Janeiro - Loterj. Master in City Law from UERJ.
