In the official statement regarding Loterj's response to the Prizes and Betting Secretariat of the Ministry of Finance, the agency asserts that the regulation of sports betting and online gaming in Rio de Janeiro "does not contain any provision contrary to federal legislation, given that the regulation 'within the scope of the State of Rio de Janeiro' only clarifies that, concerning services in the virtual environment, the provision of lottery services observes the terms of Complementary Law No. 116/2023."
Loterj also points out that the legislation dealing with the exploitation of lottery services is Decree-Law No. 6,259/1944 and that given the context of the time of its enactment, it "obviously dealt with physical lottery products... and not in virtual form."
"It is totally clear that the logic of the decree, especially in the provisions concerning territorial restriction, discipline, and handling of physical lottery operations; and even when mirrored for application in the virtual environment, within the scope of an accreditation for the exploitation of public service via the internet, no violation or trespass of the territorial limits of its jurisdiction (State of Rio de Janeiro) is found in the case of this agency's notice," Loterj states in the note.
It reminds that "in the case of a virtual service modality - subject to the discipline of the aforementioned art. 3 of Complementary Law No. 116/2003; and whose consumption, in turn, will always be preceded by unequivocal acceptance and recognition, by the consumer-bettor, of the situation in the State of Rio de Janeiro - there is no trespass, either materially or legally, of the state territorial limits, with the activity being entirely concentrated - e.g. situated, provided, and consumed - within the territory of Rio de Janeiro, for all purposes."
In Loterj's letter Loterj/Presi No. 26, addressed to the deputy secretary of the Secretariat of Prizes and Bets of the Ministry of Finance, Simone Vicentini, the agency highlights that "paragraph 1 of article 2 of Decree-Law No. 6,259, of February 10, 1944, states that 'state lotteries will be restricted to the limits of the respective State.' Also, according to the same diploma, the lottery is unquestionably a service, as can be inferred from article 1: 'Lottery service, federal or state.'"
Loterj states that "the mentioned Accreditation Notice No. 01/2023 does not contain any provision contrary to federal legislation, given that the regulation 'within the scope of the State of Rio de Janeiro' only clarifies that, concerning services in the virtual environment, the provision of lottery services observes the terms of Complementary Law No. 116/2003. Therefore, the provisions of Decree-Law No. 6,259/1944, as well as other federal laws and regulations, are fully respected."
Furthermore, Loterj indicates in its letter that "Among the rules established for exploitation in the virtual environment and within the scope of the State of Rio de Janeiro, it was stipulated, as well noticed, that 'the completion of online bets will always be considered carried out in the territory of the State of Rio de Janeiro, for all effects and purposes, including fiscal and legal ones,' a stipulation that merely reflects the wording of the general rule inscribed in article 3 of Complementary Law No. 116/2003, according to which '[t]he service is considered provided, and the tax due, at the location of the provider's establishment, at the location of the provider's domicile, except in the cases provided for in items I to XXV, when the tax shall be due at the location.'"
In the conclusions, Loterj asserts that:
"ii) In view of this scenario, and considering technological advancements and the increasing digitalization of services, we argue that the exploitation of lottery activities in the virtual environment should be understood in light of the principles governing electronic commerce (e-commerce), a sector already widely established and following principles of flexible territoriality, adapted to the digital reality."
"iii) In this sense, LOTERJ, before the issuance of any federal law to the contrary, allowed virtual betting operations to occur throughout the internet environment, not disregarding the applicable federal legislation at the time or the decisions of the STF. On the contrary, it sought to adapt to the contemporary reality of commerce and service provision, ensuring that, even in the virtual environment, operations are carried out under the aegis of the state legislation of Rio de Janeiro. This is done through the user's declaration of awareness that, regardless of their physical location, the service is being provided in the State of Rio de Janeiro, for legal and fiscal purposes."
"Therefore, we reiterate our understanding that the exploitation of lotteries in the virtual environment, as regulated by LOTERJ, is in full compliance with the legal framework, respecting both the decisions of the STF and the principles governing e-commerce and digital service provision."
"In this context and in view of all the above, it is not considered that there is any nonconformity or breach on the part of this Agency and its regulatory norms of lottery services within the scope of the State of Rio de Janeiro in relation to any federal governing legislation, so, respectfully, it is clarified that:
i. there are no 'editorial changes necessary to adapt Accreditation Notice No. 01/2023 to the governing federal legislation' to be made; and
ii. consequently, there are no circumstances or nonconformities that warrant the actions indicated in OFFICE SEI No. 18400/2024/MF."
The letter is signed by Hazenclever Lopes Cançado, president of Loterj - Lottery of the State of Rio de Janeiro.
Source: GMB
