Bodó, a town of just 2,300 residents in Rio Grande do Norte, has suspended all activities of its municipal betting operation, becoming the latest flashpoint in Brazil's growing legal standoff over local gambling authorizations.
The suspension, announced by Mayor Horison José da Silva, mentioned "inconsistencies" in the operation of Lotseridó, the municipal lottery service, particularly its fixed-odds betting products.
According to the Ministry of Finance's Secretary of Prizes and Betting (SPA), only the Union, states and the Federal District are legally permitted to operate lotteries or fixed-odds betting.
Municipal authorizations, the SPA said, are treated as equivalent to illegal operations and are reported to the national telecom regulator Anatel for blocking.
Despite that, Bodó has gone further than any other municipality in implementing its own betting system, licensing 53 websites, roughly one for every 44 residents, and collecting over BR8m between November 2024 and August 2025 through a BR5,000 licence fee and 2% of gross revenue.
The City Government authorized its registered companies to operate throughout Brazil, going against the national law, which currently establishes that only the Ministry of Finance can determine who may operate nationwide.
The town argued its framework was legal because federal law does not explicitly forbid municipalities from regulating lotteries.
The case has exposed a legal grey area now pending before Brazil's Supreme Federal Court, which will determine whether municipalities have concurrent powers to legislate on lotteries.
The city's Finance Secretary, Rômulo Farias, said he considers the action "legal because the city has its own powers. We can legislate on matters that a federal law does not prevent."
Until a ruling is issued, dozens of Brazilian cities have continued to draft similar bills in hopes of replicating Bodó's short-lived model.
More than 70 laws passed to create municipal lotteries and betting. Among them, Bodó was the only city that, in addition to approving the law, actually implemented the service.
The town's suspension of activities highlights the tension between local fiscal autonomy and national gambling oversight.
SPA has previously warned Bodó that its municipal licences violated federal law.
