Brazil's Senate Committee Approves the Security PEC Without the Betting Levy

The CCJ passed the base text by symbolic vote on 2 September, with the 30% transfer of betting revenue to public security funds removed. Amendments were not reached, and are now expected only after the elections.

• The Senate's Constitution, Justice and Citizenship Committee approved the base text of the Public Security constitutional amendment on 2 September by symbolic vote, so no individual tally was recorded
• The approved text excludes the provision under which 30% of fixed-odds betting revenue would have funded the National Public Security Fund and the National Penitentiary Fund
• Rapporteur Senator Rogério Carvalho (PT-SE), whose report removed the provision, accepted 4 of the 81 amendments filed
• Senators began considering the remaining amendments but adjourned when plenary voting started, and amendment votes are now expected only after the elections
• Sporting bodies including the Brazilian Olympic Committee, the Paralympic Committee and Flamengo had lobbied for the removal, with reported estimates of R$500 million to R$530 million a year of sports funding at stake

The Vote We Said Had Not Happened Has Now Happened

When we reported the rapporteur's report yesterday, the provision was out of the text but no vote had been taken. On 2 September the Constitution, Justice and Citizenship Committee of the Brazilian Senate approved the base text of the Public Security constitutional amendment, and the betting provision is not in it.

The approval came by symbolic vote, the procedure in which no individual tally is recorded, which is normal for a committee text with broad support and tells you nothing about how contested the underlying question was. Senator Rogério Carvalho of the Workers' Party, representing Sergipe, prepared the version that passed, accepting 4 of the 81 amendments that had been filed.

What has been removed is the clause under which 30% of revenue from Brazil's regulated fixed-odds betting market would have become a funding source for the National Public Security Fund and the National Penitentiary Fund. Carvalho's stated objection was one of sequencing: the provision, he argued, reversed the logic by which betting resources are distributed, because it protected the sums allocated to fund betting operations before the base was calculated that feeds education, sport, social security and health.

The process did not finish. Senators started working through the remaining amendments and stopped when plenary voting began. Consideration of those amendments is now expected only after the elections, which pushes any final Senate disposal of the text into a new political period.

Approved Does Not Mean Settled, and the Calendar Is Now the Story

A base text approved in committee with 77 of 81 amendments unresolved is not a finished piece of law, and the deferral of those amendments until after the elections matters more than the vote itself. Everything about this measure now depends on a Senate whose composition and priorities will have been reset by an election, considering amendments filed under different circumstances. Any operator reading yesterday's removal as the end of the argument should note that reinstating the transfer requires only an amendment that survives, and that the stated intention of those who lost it was always to bring the allocation back later as an ordinary bill. The provision has been taken out of the constitutional vehicle. It has not been taken off the table.

The Sector Won a Round It Did Not Fight

It is worth repeating what this outcome is not. Brazilian operators did not lobby for the removal and do not benefit from it: the same revenue is collected either way and only its destination changed. The winners are the sporting bodies that argued the transfer would divert R$500 million to R$530 million a year away from sport, and the mechanism was a rapporteur persuaded on a drafting point. The industry was not in the room for that either, which makes two decisions in three days about the sector's money taken without it, after the Planalto meeting that produced statements from three trade bodies for the same reason. Being fought over is not the same as being consulted, and Brazilian betting revenue is now firmly in the first category.

The committee has approved a text. The amendments that could put the levy back are queued behind an election.