Brazil’s AGU backs federal control over betting; Supreme Court reviews municipal lotteries

Brazil’s Attorney General’s Office (AGU) has formally supported a legal challenge to block dozens of municipal laws which authorize local betting and lottery operations. In its opinion submitted to the Supreme Federal Court (STF), the AGU stated municipalities lack constitutional authority to create or regulate fixed-odds betting systems, calling such actions a direct breach of federal law.

According to the AGU, the targeted local laws are “extrapolating their legal limits” by authorizing betting systems, some even partnering with private companies not approved by the Brazilian Secretary of Prizes and Betting.

The AGU maintains only the Union can legislate betting systems and operate lotteries with individual states. Municipalities, under this interpretation, are not allowed to issue licenses, launch platforms or create fixed-odds products, especially online.

The document also questions the practicality of oversight, noting that over 5,000 municipalities operating their own betting services would create regulatory chaos and risk public harm. The AGU flagged concerns including money laundering, gambling addiction and the promotion of unverified operators.

Good to know: Recently, a Senator called for more time to complete the Brazilian Parliamentary Inquiry on bets, mentioning delays, missing witnesses and a lack of quorum as obstacles

The case uses as an example a small city in Rio Grande do Norte with fewer than 2,400 residents and 38 licensed betting companies, the equivalent of one betting company for every 62 inhabitants in the region. This, according to AGU, is an obvious distortion of scale and legality.

Mentioning federal supremacy and player safety, the AGU called for all local betting laws named in the suit to be suspended. If accepted, the STF’s decision could significantly reshape the balance of power between national and local regulation in Brazil’s betting industry.

Carlos Mendez

Writer

Odds tell a story long before the result does. When bettors learn to read that story properly, betting becomes a matter of discipline and value rather than emotion or guesswork.

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