The State Decree is based on the decision of the STF of September 30, 2020, published in a judgment of December 15 of the same year, which upheld the Fundamental Precept Non-Compliance Arrangements (ADPFs) 492 and 493, and decided, unanimously, that the Union does not have a monopoly to maintain lottery games, and that, therefore, lottery is a public service provision that can be exploited by the states, as long as they are in accordance with federal regulations.
In cases of concession to the private sector, Lotep will be responsible for inspecting the exploitation, ensuring compliance with the contractual obligations assumed and the integrity of the distribution of the announced award. Lotep is also responsible for guaranteeing the integrity of both the announced award and its payments and remuneration to the State.
In cases of direct exploitation of the public service of state lotteries, companies that provide infrastructure and technology solutions may be hired under current legislation that regulates procedures. The public services that include the exploration of lottery activities will be: traditional or conventional lottery; instant lottery; lottery system online and in real time; special lottery (permanent or occasional); mixed lottery; numerical prognosis lottery; and fixed odds betting.
Thus, according to the Decree, it will be up to Lotep: “to plan, coordinate, authorize, accredit, license, direct, execute, distribute and control the activities related to the exploration of the lottery and similar games, including electronic and physical and digital , observing the federal legislation regarding the matter; promote and implement game plans, programs and projects aimed at exploring the lottery market and the like; articulate with similar institutions from other units of the federation, with a view to combining efforts and achieving common goals; carry out prize draws, ratify the results; proceed with the payment of prizes, related to the sweepstakes of creation and full execution; promote the issuance and distribution of lottery tickets; supervise activities related to the exploitation of lottery and similar games; disciplining by ordinance the exploration of lottery activities; and develop other related activities.”
The regulations also attribute as revenue sources for Lotep: “the result obtained from the sale of lottery tickets; budget allocations consigned in their favor; resources from the signing of contracts, accreditations, licenses, covenants and agreements; revenue from the sale of movable and immovable property that is not part of its assets; provision of administrative services resulting from the transfer of ownership in contracts, signed by sale, succession or others; provision of administrative services resulting from the mandatory annual renewal of contracts; the provision of digital service by multiplatform and streaming applications; provision of the service of analysis of draw plans submitted by companies / interested parties; provision of the service for carrying out separate draws; registration of promotional campaigns; provision of the service for conducting sweepstakes which are the subject of campaigns; use of the LOTEP brand by third parties, with an emphasis on the credibility of the state agency; other occasional incomes, including those resulting from the provision of services ”.
EXPLORATION OF LOTTERIC ACTIVITIES
The State Decree still prohibits the exploitation of any lottery modality within the scope of the State of Paraíba without prior authorization from Lotep, except for the lottery services that are already operated by the Union.
The public service that makes up the exploitation of lottery activities, for the purposes of this decree comprises: “traditional or conventional lottery; instant lottery; lottery system online and in real time; special lottery (permanent or occasional); mixed lottery; numerical prognosis lottery; and fixed odds betting.”
According to the STF's decision, the exploitation of lotteries is of a public service nature and that federal legislation cannot impose on any federative entity “restrictions on the exploitation of public services in addition to that already provided for in the constitutional text (article 175).”
The jurisprudence of the Supreme Court confirms that the private competence of the Union to legislate in consortium and sweepstakes systems does not impede the material competence of the states to explore lottery activities or to regulate such exploration. It also stressed that only the Union can define the modalities of lottery activities that can be exploited by the states.