JUE 14 DE NOVIEMBRE DE 2024 - 03:18hs.
A company cannot operate in more than one state

Prosecutor General defends constitutionality of federal law that impose limits on state lotteries

Brazil’s Prosecutor General, Paulo Gonet, sent an opinion to the Supreme Federal Court defending the constitutionality of sections included in Law 13.756 that restrict the participation of companies in lottery services in the states and the Federal District and regulate the advertising of the activity. According to him, the limits fall within the competence of the Union to regulate the lottery system, the promotion and planning of the sector.

Furthermore, the rules are in accordance with the constitutional principles of equality and consumer protection, in the opinion of the attorney general.

The statement was made in Direct Action of Unconstitutionality (ADI) 7640, proposed by the states of São Paulo, Minas Gerais, Paraná, Acre, Mato Grosso do Sul and Rio de Janeiro and the Federal District.

They question the validity of paragraphs 2 and 4 of article 35-A, included in the federal rule that regulates state lotteries. The provisions establish that the same economic group or legal entity may only operate the service, through a concession, in a single state. In addition, they prevent the lottery of one state from advertising in another.

What the Prosecutor General's office says

In his opinion, Paulo Gonet refutes the arguments presented by the authors and argues that the request made in ADI 7640 should be denied by the STF. In his opinion, the Union has exclusive authority to legislate on consortium and lottery systems in Brazil, and member states may operate public lottery services within the limits established by federal law.

In this context, by preventing the same economic group from participating in lottery services in different states, Law 13,756/2018 seeks to prevent the concentration of private economic power in a sector that tends to be sensitive to the economy.

“The restriction established by federal law tends to promote a market that is more open to economic agents, with more intense competition,” argues Paulo Gonet. According to him, measures that “deconcentrate the market” encourage new agents to compete for space.

Regarding the limitation of advertising for these services, the PGR argues that the legislation seeks to prevent states with more resources and greater advertising capacity from disproportionately attracting a greater volume of bettors from other states of the federation.

“Since there is constitutional support for the geographic restriction of the operation of lotteries, the geographic limitation of their advertising is also permitted,” he concludes.

Source: GMB