Brazil: Rio de Janeiro Lottery has accredited 13 sports betting companies

In addition to the four companies already operating in this jurisdiction, another 13 bookmakers have been accredited by the Rio de Janeiro Lottery (Loterj), with an open call until May 14 to provide their services in the state. In addition, there is one company waiting to pay its license fee, eight others are in the process of having their documentation analyzed and another 20 are in the process of accreditation.

In recent months, a modification to a Loterj public notice opened the possibility for companies to operate sports betting at the state level while accepting clients from all over Brazil, opening a serious discussion in the sector and an imbroglio with the Ministry of Finance and with other states of the federation. 

In practice, platforms licensed in Rio de Janeiro can already accept clients throughout the country. 

With an operating license fee of BRL 5 million (almost $1 million), while the Federal Government is asking for BRL 30 million (almost $6 million), the competition is considered unfair and illegal. At the end of March, the Treasury asked Loterj to amend parts of its public notice. The main issue was the authority's capacity to accredit companies from any state or country and determine that the betting would take place in Rio de Janeiro. Treasury said it was up to the states to operate only in their territories.

Hazenclever Cançado

In response to the Ministry of Finance, the President of Loterj, Hazenclever Cançado, affirmed that the issues raised are based on a law from the 1940s that deals with banknote printing.

"In the case of the notice issued by this authority, there is no violation or transfer of the territorial limit of its competence," he said, adding that virtual commerce "follows flexible territoriality principles, adapted to the digital reality."

For his part, Lottopar CEO Daniel Romanowski said in an interview with Yogonet: "In our interpretation, the problem with Loterj's actions is the question of territoriality. I believe this could create problems for other sectors because it could turn into a tax war. It is as if a lawyer living in Paraná provided services in São Paulo but issued invoices from Mato Grosso. It is confusing, it does not make sense."