Zona de Azar Brazil – MPF Reinforces Request to STF to Ban National Operation of Loterj Bets

Brazil.- October 29, 2024 www.zonadeazar.com The legality of online sports betting in Brazil has sparked new discussions. The Office of the Attorney General (PGR) addressed the Supreme Federal Court (STF) regarding a motion from the Office of the Solicitor General (AGU) aiming to prohibit the Rio de Janeiro State Lottery (Loterj) from authorizing online sports betting nationwide.

The PGR’s statement, reinforcing the AGU’s request, was submitted last Friday (25) at the request of the case’s rapporteur, Minister Edson Fachin.

Lack of Transparency in Loterj’s System

In this context, the AGU filed the Civil Original Action (ACO 3696) with the STF, seeking a preliminary injunction to prevent bets licensed only by Loterj from operating outside Rio de Janeiro state.

According to the AGU, current legislation limits betting activities to a regional scope, with the Union having sole authority over lottery services nationwide.

The AGU argues that Loterj allows bettors to declare that their bets are placed in Rio de Janeiro but lacks a reliable geolocation system to verify the origin of these bets.

In practice, this authorization enables companies to operate nationwide. The AGU’s statement also cites specific examples.

States like Paraná and Maranhão require geolocation mechanisms to be implemented before authorizing lottery services.

This requirement aims to ensure that competition rules remain fair and equitable among federal states.

Impacts of Loosening Betting Regulations

The PGR aligns with the AGU in stating that relaxing these territorial restrictions could lead to a federative imbalance. A technical note from the Ministry of Finance’s Prize and Betting Secretariat (SPA) indicates that Loterj’s criteria represent a “perverse incentive for predatory competition.”

This perspective suggests that by allowing national operations, Loterj could be creating an environment similar to a ‘tax war’ among states.

Additionally, the PGR emphasizes that Loterj’s operations could negatively affect interstate relations, undermining the harmony of Brazil’s lottery system.

Minister Fachin will assess the impact of this decision while carefully reviewing the AGU’s injunction request. The ruling could redefine how the Union and states will regulate and oversee these activities.

Edited by: @_fonta www.zonadeazar.com