For all those who are following the LOTEX novel - the famous exclusive lottery of the Federal Union, whose Ministry of Finance tries to implement through a concession, last week another important chapter occurred: the publication of Decree N° 9,327, on April 4th, 2018. It happens that the decree on screen can mess up more than helping. It expands the regulatory risk exposure of those who intend to invest in the Brazilian lottery market. In dealing with sector regulation, it assigned powers to the Ministry of Finance, without due legal protection (as we shall see later). And, in short, we have one more element that can be discussed in the Courts.
We do not have doubts about the potential of the Brazilian lottery market, however, the perception of regulatory risks impacts the evaluation of the economic-financial balance of the desired concession. This is because, among the principles contained in the Brazilian Constitution, we have LEGALITY (article 37), and as a consequence of it, it is not possible to attribute competences through a different law degree in the strict sense (law approved by the National Congress through a legislative process regular). In fact, art. 14 and following of Decree n. 9.327/18, by assigning "regulatory body" jurisdiction to the Ministry of Finance did so without a statement of reasons and, therefore, weakened the system from the point of view of legal certainty. To support the above statement, let us see what is contained in the preamble of Decree 9.927 / 18: THE PRESIDENT OF THE REPUBLIC, in the use of the attribution conferred by art. 84, item IV, of the Constitution, and in view of the provisions of art. 28 of Law 13,155 of August 4, 2015, in art. 2 of Law 13,262 of March 22, 2016 and Resolution 16 of August 23, 2017, of the Council of the Program of Investment Partnerships of the Presidency of the Republic.
That is, this preamble is indicating the legal grounds of the decree: art. 84, IV of the CR / 88 (exclusive competence of the President of the Republic - only he can practice the act of sanctioning, promulgating and publishing the laws, as well as issuing decrees and regulations for his faithful execution) and Law no. 13,155 / 15 (which establishes LOTEX within the framework of the principles and practices of fiscal and financial responsibility and transparent and democratic management for professional sports organizations of football among other subjects related to such practice), which in its art. 28 prescribes: OF THE LOTTERIES (...) The Federal Executive Power is authorized to institute the Exclusive Instant Lottery - LOTEX, having as theme brands, emblems, hymns, symbols, shields and similar with regard to the entities of sport practice of the modality soccer, implemented in physical or virtual environment. In summary, the preamble informs the fundamentals of effectiveness of the decree on the screen and, given the competence determined by the Constitution and the Law that authorized the granting of LOTEX, we ask: at what moment did the Constitution and / or the aforementioned law assign the regulatory competence to Ministry of Finance? If not, could the President of the Republic, by decree, create such competence? Rhetoric in section, we have that both questions deserve negative responses.
In order to situate the vulnerability of the decree, we will review the concept of regulation and the role of the regulatory agency (or regulator), especially to characterize that the LOTEX Law did not assign such powers to the Ministry of Finance. In this sense, we see the concept in the lesson of VITAL MOREIRA (1997): (...) for Mitnick (1980: 7), public administrative policing of private activity with respect to a rule prescribed in public interest. In the definition of JC Strik (1990: 3), regulation consists in the "imposition of rules and controls by the State for the purpose of directing, restricting or altering the economic behavior of individuals and companies and which are supported by sanctions in the event of disrespect ". In addition, MICHEL GENTOT (1994) defined the three fundamental activities to characterize the regulatory body: a) to edit the norms; b) apply the standards; and c) suppress infractions.
It is important to note that a factor of success of the regulatory agents is the granting of normative competence. The question is thus inserted within the topic of legislative delegations. This is because one of the assumptions of the existence of the agent is its ability to respond immediately to the demands made by agents in the market. By way of illustration, we point out that there are three basic types of normative delegations, namely: a) reticent delegation (consists in transferring the legislative function to the Executive Branch for this to edit norms with force of law, at the limit of the delegation, and, once edited , can not be further changed); b) remittance delegation (consists of the legal remittance to a later rule, without force of law and within the limits of delegation); and c) delegitimation (which is the transfer of certain matters from the ordinary legislative plan to a lower court). In the Brazilian legal system, DUEGO DE FIGUEIREDO (2001) states that with the emergence of the model of regulatory agencies in Brazil, there was the introduction of the phenomenon of delegitimization of the regulated sector. According to him, the phenomenon was developed in the French Doctrine under the title of délégation de matières, being inaugurated by the jurisprudence of the French Council of State in 1907. For this Doctrine, the Legislative Power itself (and no other), in certain matters, can delegate to an organ of the State the competence to edit certain norms, thus occurring the translation of those from the domain of the laws (domaine de la Loi) to the domain of the regulations (domaine de l 'ordonnance).
An example of this phenomenon in Brazil was the advent of Law n. 9478/97, which "downgraded" the pertinent matter to the petroleum sector to the ordinance status, as a consequence of art. 177, §2, III of the Constitution. In practical terms, regulatory mandates were subject to change by the regulatory agency. In other words, the National Congress mandated that a whole bloc of legislation lose the status of law. By means of this mechanism, the National Congress (and only itself, it is worth remembering) can edit a law to circumscribe certain matter (regulatory framework) and, similarly, when creating the regulating agent (attributing to it the competence), circumscribes an object (area to be regulated) and a goal (the public interest to be achieved) by it.
Once all this has been done, how the regulation is established, it is evident that the rule inscribed in art. 14 of Decree n. 9,327 / 18 is fragile, since it was not authorized by the National Congress (specific law in this sense) and, however, such a prescription could easily be challenged in the Courts.
For all of the above, if the Ministry of Finance sought, through the decree in focus, to strengthen its LOTEX concession process, it would be better if such an attempt were made via the Provisional Measure, whose constitutional provision resides in art. 62 and has the force of law.
Marcello M. Corrêa
Lawyer and Master in Political Science from Fluminense Federal University
