"The eventual invalidation of these legal acts would result in multimillion-dollar compensations, a significant loss of tax revenue, and the disruption of an entire regulated economic sector," states Loterj in the motion for objection submitted to the Supreme Federal Court (STF).
In the case, Loterj defends its public notice, arguing that the federal government has failed to demonstrate that its alleged right is sufficiently clear. The petition further states:
"Loterj's territorial jurisdiction is supported by precedents from this very Honorable STF, which recognize the autonomy of states to operate and regulate lotteries within their jurisdictions, as is the case here. Moreover, the fact that the amendment to the public notice includes a formal declaration from bettors stating that they are playing within the territory of Rio de Janeiro only shows that Loterj is taking steps to maintain the territoriality of its process, subjecting bettors to its direct jurisdiction, which weakens the unfounded argument of a violation of territoriality."
In its motion, Loterj contests the arguments made by the Office of the Attorney General (AGU) that the operations of the Rio de Janeiro state agency lack rules regarding criminal activities. Loterj assures that it "has implemented a robust anti-money laundering prevention system, including strict client identification, transaction monitoring, and reporting of suspicious activities."
Loterj also claims that all operators accredited by it pay federal taxes, which constitutes the "only effective source of revenue for the federal government in the sports betting sector" at present. "This situation stands in stark contrast to that of the websites listed in the 'positive list' released by the Ministry of Finance, which operate without any defined tax obligations," the agency emphasizes in its request.
With the lawsuit against the Loterj-accredited betting companies filed by the federal government, the agency asserts that:
"In light of this fact, the true interest of the federal government in this case is called into question. By seeking to suspend the operations regulated by Loterj, the federal government would, in practice:
1. Be forfeiting significant ongoing tax revenues.
2. Be allowing websites listed in its 'positive list' to operate without proper authorization, outside the scope of regulation, and without paying taxes, until the first federal license is granted.
3. Be creating a regulatory and fiscal vacuum that could last for months or even years, considering the complexity of the federal regulation process."
Source: GMB
