Brazil's Supreme Court has suspended the effectiveness of every municipal law that created local lotteries or authorized fixed-odds betting, following a precautionary ruling issued by Minister Nunes Marques.
The decision applies immediately and extends across all of the country's more than 5,500 municipalities.
It also covers bidding processes, accreditation procedures and ongoing operations previously approved by city governments.
The minister's order establishes significant penalties for non-compliance. Municipalities and companies that continue to run or authorize betting activities face a daily fine of BR500,000 ($94,730), while mayors and executives may incur individual penalties of BR50,000.
The case will still be examined by the Supreme Court plenary, but the injunction remains in force until further review.
Nunes Marques argued that the expansion of municipal betting laws violated the constitutional division of powers, as lottery regulation requires uniform national rules, specialized oversight and technical capacity that cities do not hold.
He stated that the rapid proliferation of local legislation had created "a parallel market" and threatened regulatory coherence, while also enabling companies without approval from the Ministry of Finance's Secretariat of Prizes and Betting (SPA) to operate under local authorizations.
According to the ruling, more than 55 municipalities enacted their own lottery laws in 2025 alone, with over 80 doing so in the last three years.
The minister said the resulting landscape created competitive distortions and increased risks for consumers, as many municipal schemes lacked federal standards for security, fraud prevention and operational control.
The ruling lands after a year marked by an unprecedented boom in municipal lottery projects, a movement that has reshaped local interpretations of what a "state lottery" can be.
The decision also requires Brazil's SPA and the National Agency of Legal Gaming (ANJL) to coordinate the blocking of irregular betting sites
