Zona de Azar Brazil – Brazil Rio de Janeiro: Union Granted Exclusivity Over Betting Sites

Brazil- August 21, 2024 www.zonadeazar.com – The Federal Court of Rio grants the Union exclusive authority to legislate on betting sites.

The Regional Federal Court of the 2nd Region (Rio de Janeiro and Espírito Santo) granted an injunction to Kambi, the world’s largest sports betting platform, allowing it to operate without penalties under a state decree regulating the market.

The decision by the 27th Federal Court of Justice in the capital, Rio de Janeiro, was made in response to a writ of mandamus filed by Kambi and will remain in effect until the Union makes a final decision on the merits of the case.

Union Wins Dispute Against Rio State in the Betting Sector

The company turned to the judiciary after the regulatory agency for gaming in the state of Rio de Janeiro, Loterj, initiated an administrative procedure against the company.

However, Kambi challenges State Decree No. 48.806, enacted on November 21, 2023, which establishes the conditions for studying lottery formats.

In its petition, the platform states that the state government requested that Anatel block the gaming site due to this regulation.

Loterj Prohibited from Conducting Due Diligence in Administrative Process Pending Further Review

According to a decision by federal judge Geraldine Pinto Vital de Castro, Loterj is prohibited from taking any action in the administrative process, and the process must be suspended pending further analysis by the court.

The reason is that the Republic’s Constitution states that “it is the exclusive competence of the Union to legislate on union systems and lotteries.” Therefore, the judge emphasized that the regulation of this activity is currently established by Federal Law No. 14.790, of 2023.

The judges noted that in May 2024, the Secretariat of Prizes and Betting of the Ministry of Finance regulated the provisions of the law through a regulation that sets standards for business activity in this area in Brazil. Thus, the deadline for sports platforms to comply with the regulations is December 31 of this year.

“Currently, federal regulations require that the authorization for the commercial use of lotteries through betting involves the following categories: legal qualification, financial and labor regularity, suitability, economic-financial qualification, and technical qualification,” wrote judge Geraldine De Castro.

Therefore, taking this into consideration, she understood that Decree 48.806/2023 “exceeds the limits of the State’s competencies and violates the Federal Agreement by seeking to regulate this market and impose sanctions.”

Editó: @_fonta www.zonadeazar.com