SÁB 4 DE MAYO DE 2024 - 02:44hs.
In order not to weaken federal concessions

Brazilian states begin to launch own lotteries, but federal government wants to limit bets

The Secretariat for Evaluation, Planning, Energy and Lottery of the Ministry of Economy (Secap-ME) will publish by the end of January an ordinance establishing rules for the creation of lotteries and sports betting systems in the States. One of them is the adoption of mechanisms that prevent bets from other entities of the Federation. One of Secap-ME's goals is to prevent creation of state lotteries from emptying federal concessions for the sector, which can yield up to US$ 1.85bn, but the measure can be challenged and end up in the courts.

Judgment published in November by the Federal Supreme Court (STF) eliminates the Union's monopoly on the sector and allows other federal entities to exploit this vein. Congress passed the law that authorizes sports betting, but after two years the government has not regulated the measure. The expectation is that this will happen in July, with the forecast to come into force only in the beginning of 2022. In the meantime, States are taking advantage of the gap opened by the Supreme Court and creating their betting systems.

The first one was Maranhão, where the Legislative Assembly unanimously approved the project, and the government issued a decree in the last week of the year. At least 12 other states are following the same path.

Several state governments intend to create online betting systems, via internet, similar to those explored today in Brazil by foreign companies. Internet sales could be made anywhere in the country. This, according to market experts, deflates the Planalto project.

After the STF's decision, Secap-ME made a consultation with the Attorney General's Office (AGU) with 15 questions. One was about the possibility of banning state online lotteries, to which AGU responded in negative way.

“We cannot prevent states from working online, but we can put limits. It was our intention, but unfortunately we cannot prohibit it. Control is theirs (States). They can sell over the internet, but they cannot cross the boundaries of their territories. The technological solution is theirs,” said the head of Secap-ME, Waldir Eustáquio Marques Jr.

According to him, the AGU considers that it is up to the Union to standardize the procedures of the States in accordance with the 1944 law that regulates state lotteries and imposes the boundaries of each federative unit as a limit of coverage.

The president of Maranhão Parcerias (Mapa), the state company responsible for making the Maranhão lottery viable, Antonio de Jesus Leitão Nunes, said that there is no technological solution to create borders on the internet and the ordinance may lead to a new legal battle, since the STF has decided for the autonomy of States in this matter.

"I understand that this is not feasible, and it is up to a legal discussion between the States and the Union. According to the STF, the Union cannot have exclusivity in this," said Nunes.

According to Secap-ME, the territorial limitation of state lotteries is what will keep private companies interested in the national lottery. “The sale of the federal product is not going to decrease because it can be sold in the country as a whole while the others are only in the states. The sale is bigger. It doesn't affect the price,” said Marques.

Uniformization. According to him, the Union wants to standardize the exploitation of the sector by the States in order to provide legal certainty and create control mechanisms for issues such as the possibility of manipulating sports results, the use of gambling as a means of money laundering and protection of pathological gamblers.

In addition, the ordinance must establish prize values, percentages for social programs, among other aspects, to guarantee free competition.

Marques denied that the government was run over by the STF's decision. “I will not say that it is running over because this specific issue of state lotteries was already a demand from the entire sector and even ours. We saw that the States needed this source of revenue, but there was a gray area in the laws,” said the secretary, a technician with 13 years of experience in the area.

In the case of Maranhão, for example, the largest share of the amount to be collected by state lotteries will go to a fund that will finance scholarships for young people in the state.

A public tender notice must be published by the end of the year in Brazil and abroad to choose the companies that will operate each modality. The idea is that the system will be in operation before the end of the year.

Source: Ricardo Galhardo, O Estado de S.Paulo