Challenges are a recurring matter before the Supreme Federal Court (STF), which is frequently called upon to rule on issues related to the interpretation of the Federal Constitution. Recently, on March 12, 2025, ADPF 1212 was filed and assigned to the rapporteurship of Justice Nunes Marques. The petitioner argues the unconstitutionality of municipal laws and regulations that create local lotteries.
We believe this represents a great opportunity for the STF to enhance the effectiveness of the legal and economic foundation of lotteries, namely, funding actions aimed at reducing social vulnerability, including initiatives in sports, education, and public health. Furthermore, it would help clarify the important decision rendered by the Supreme Court in September 2020 and make this public policy more rational.
Such actions are only justified when there is a violation of fundamental principles of the Constitution. In this case, as demonstrated in the initial petition, it seems clear that certain municipalities are attempting to destabilize the distribution of powers among the federal entities, as established by our Constitution.
Regarding procedure, any doubt about the existence of another effective means to remedy the injury was dispelled when the rapporteur Justice decided to apply the procedure under Article 6 of Law 9.882/1999, as per the ruling:
“3. I apply the procedure of Article 6 of Law No. 9.882, of December 3, 1999. Let the information be collected, as well as the statements from the Office of the Attorney General and the Office of the Prosecutor General. 4. Publish.”
Given the relevance of the issue, in addition to the statements from the AGU (Attorney General's Office) and the PGR (Prosecutor General’s Office), the rapporteur Justice summoned the mayors of the following municipalities to provide information in the case before the STF: São Vicente (SP), Guarulhos (SP), São Paulo (SP), Belo Horizonte (MG), Foz do Iguaçu (PR), Pelotas (RS), Caldas Novas (GO), Estância Hidromineral de Poá (SP), Campinas (SP), Anápolis (GO), Bodó (RN), Miguel Pereira (RJ), and Porto Alegre (RS).
The statements from the PGR, AGU, and the mayors appear to be the most appropriate approach to politically and technically support the STF's decision. In light of general legal principles, the issue seems straightforward, as Brazil’s federal system does not allow municipalities to establish lotteries, especially since their legislative and executive powers are not residual.
When analyzing this issue from a legal and best public policy practices perspective, we observe that no federal countries, such as Germany or the United States, operate municipal lotteries. Introducing such a model in Brazil would represent yet another case of public policy that worsens the inefficiency in the use of public funds, thus violating the constitutional principle of administrative efficiency.
Historically, until 1967, state lotteries were responsible for funding social vulnerability reduction programs. With the peak of the military dictatorship that year, there was an attempt to eliminate state lotteries and centralize lottery operations at the federal level—an effort that proved to be a historical mistake due to the inefficiency of the federal monopoly in the lottery sector.
In 2020, the Supreme Court corrected this mistake by legalizing state lottery operations and will now undoubtedly help prevent what would be another historical mistake: the attempted legalization of municipal lotteries.
Therefore, considering the relevance of the matter under review in ADPF 1212, and the impact this decision will have on social order and legal certainty, the STF Justice took precautions in the initial ruling by ordering measures for "the statements of the involved authorities, aiming for a definitive resolution of the controversy, without prejudice to, at any time, considering the preliminary injunction request, in view of the risk and urgency pointed out in the initial petition.”
We believe this precaution allows the Justice to make a thoroughly reasoned decision. After all, as the saying goes, “the hardest part of public life is doing the simple and obvious,” without allowing excessive delay. Any prolonged uncertainty suggesting the potential creation of more municipal lotteries could accelerate the preliminary injunction review.
The STF’s decision must be clear, firm, and aligned with its previous rulings on the matter, especially given the issue’s importance. Uncertainty around the interpretation of STF’s Binding Precedent No. 2 and the lack of a dispositive statement in the ADPF 493/Able ruling could create undesirable liabilities for municipalities involved in an activity for which they only have limited responsibilities—such as collecting service tax (ISS) and issuing location permits for physical establishments, which are, indeed, legitimate local interests.
The argument attempting to derive municipal protection from the ADPF 493 ruling—found in the reasoning behind some of these new laws—fails due to the lack of any constitutional (or eventual legal) provision supporting such a reading. The ratio decidendi of that ADPF clearly supports only the Union, the States, and the Federal District in exploring lottery draws, as per Article 25 §1 of the Constitution, which does not apply to municipalities.
Quoting the late judge Péricles Prade, who was consulted on the case:
“The reality is that, regardless of distinguishing (normative precedents rendered inapplicable due to peculiarities) or overruling (with retrospective effects, i.e., ex tunc, through a complete shift in previously settled case law), municipal laws and regulations were not affected by the ruling’s dispositive content by any of these legal techniques, nor could they be. The ruling applies strictly to the Union and the States.”
Thus, municipal laws establishing lotteries are infringing on the constitutional provisions governing the distribution of powers among federal entities. It is a legally risky strategy for municipalities to interpret creatively the STF’s ruling, especially since the Court does not recognize the doctrine of the transcendence of ratio decidendi (as noted in STF Informative No. 808), which would allow them to justify their actions based solely on the opinions expressed in votes.
Why are municipalities trying to implement their own lotteries? They argue that this is a beneficial and appropriate measure for Brazil, based on the opinion of the idea’s proponents. We see this as a complete departure from the natural order of things, understood here as the philosophical and scientific tradition that seeks to comprehend the universe by reflecting on the place occupied by human beings and aiming rationally for improvements in that space.
In short, it is unequivocally a violation of the federal pact when municipalities innovate their local legislation to establish their own lotteries and operate one or more types of “draws” in their jurisdictions.
Alexandre Manoel
Chairman of Aposta Vencedora SA. Holds a degree in economics from the Federal University of Alagoas, a master’s from FGV/Rio’s Graduate School of Economics, and a Ph.D. in economics from the University of Brasília. He began his career as an economics professor at UnB and has worked at Ipea (2004–2012), the Strategic Projects Department of the Maceió City Hall (2013–2015), the Ministry of Finance/Economy (2016–2020), and AZ Quest Investimentos (2021–2024). He was also Chairman of the Board at Dataprev and a board member at Eletropaulo.
Roberto Brasil Fernandes
Lawyer with postgraduate studies in Law. Member of the National Committee (Special Committee on Sports, Lottery, and Entertainment Law of the Brazilian Bar Association – OAB). Participated as a guest in the Special Committee on the Legal Framework for Gaming in Brazil (2015, 2018, and 2019) at the Chamber of Deputies and in the Finance and Taxation Committee regarding fixed-odds sports betting – lotteries, and in the Senate on electronic gaming. He represented ABLE (Brazilian Association of State Lotteries) from 2004 to 2019 before the higher courts (including the lotteries of Santa Catarina, Paraíba, Ceará, and others). Represented state lotteries in Congress until March 21, 2019. Author of the book Lottery Law in Brazil, published by Fórum in 2020.
