Rio Grande do Norte court strikes down Jaçanã municipal lottery law as unconstitutional

The Court of Justice of Rio Grande do Norte has invalidated Jaçanã’s municipal lottery law, saying the creation, regulation, and operation of lottery services belong exclusively to the federal government. For high-risk operators, the takeaway is straightforward: municipal workarounds for gaming and betting licensing are getting shut down in Brazil’s courts, not normalized.

1. The court declared Municipal Complementary Law 54/2025 unconstitutional and held that lottery services fall under the exclusive authority of the Union, relying on article 22, item XX, of the Federal Constitution.
2. The ruling followed the opinion of reporting judge Amílcar Maia. The court also said municipalities do not have constitutional authority to institute, regulate, or exploit lottery services because the matter is neither a local interest issue nor part of municipal powers.
3. According to the decision, the law approved in Jaçanã would have allowed lottery operations directly or through concessions and partnerships with private companies. Once the core provisions were struck down, the entire law lost validity. The mayor and the president of the Jaçanã City Council were formally notified.
4. The case started with a Direct Action of Unconstitutionality (ADI) filed by the Public Prosecutor’s Office of Rio Grande do Norte (MPRN). In 2025, the MPRN filed similar actions against 17 municipalities in the state over the same issue.
5. The ruling also aligns with the Supreme Federal Court (STF), which had already ordered the suspension of similar municipal laws across the country. The state judiciary in Rio Grande do Norte had reached the same conclusion about a similar law in Itajá about two weeks earlier. The only municipal lottery that actually operated in Brazil, in Bodó, also in Rio Grande do Norte, was later suspended.

The broader backdrop matters: since the federal government regulated fixed-odds betting in December 2023, more than 70 Brazilian municipalities have passed laws to create their own lotteries with online casino features. The federal government considers that move irregular, and the courts are now matching that view with actual enforcement.