Critical analysis of the preliminary injunction in ADPF 1212 in light of the jurisprudence of the STF (Brazilian Supreme Court).
The recent preliminary injunction issued unilaterally by Minister Nunes Marques in the Argument of Non-Compliance with Fundamental Precept (ADPF) No. 1.212, which suspended the effectiveness of municipal laws establishing lotteries throughout the country, has reignited the debate on the Federal Pact and the material competence of subnational entities. By accepting the request of the Solidarity Party, the decision imposed an abrupt halt to an expanding market, under the justification of preventing what it classified as an "unconstitutional metastasis". However, a careful analysis of the grounds for the decision—compared with my Legal Opinion prepared and attached to the proceedings at the request of the National Association of Municipal and State Lotteries (ANALOME), in my capacity as amicus curiae , as well as the Economic Legal Opinion also presented by ANSEJA—reveals how delicate the understanding and interpretation of the Constitution is, a matter of high relevance to the effective autonomy of the other federated entities, deserving further debate by the Full Court of the highest Constitutional Court.
ADPFs 492 and 493 establish a clear distinction between the legislative competence of the Union and the material exploitation of lottery services by the States and Municipalities. The decision in ADPF 1.212 seems to ignore this nuance, treating the exclusive competence of the Union as an insurmountable barrier to municipal action. This view not only contradicts jurisprudence but also disregards the principle of the autonomy of federative entities, essential for harmonious coexistence in the Brazilian federative system.
This interpretation, in our assessment, ignores the essence of the leading opinions in previous judgments, such as in ADPFs 492 and 493. The inclusion of municipalities was not requested by the plaintiffs, but is logically inseparable from the indissoluble Federal Pact of the Constitution of our Republic. As widely highlighted, both Minister Gilmar Mendes and Minister Alexandre de Moraes stated explicitly that state or municipal legislation only conveys material competence granted by the Constitution. To treat this reasoning as obiter dictum is to empty the foundations of the unanimous judgment of the Supreme Federal Court that decided on the breaking of the monopoly and the absence of exclusivity of the Union for the exploitation of public lottery services.
The decision is based on a restrictive interpretation, alleging that lottery services do not fall under the concept of "local interest" (Article 30, I, of the Federal Constitution). However, the analysis does not delve into the main argument, which rests on items II and V of the same article, which address, respectively, the supplementation of federal and state legislation and the organization and provision of public services of local interest. It is worth noting that the financing of Social Security is, by its very nature, of local interest. The Federal Constitution, in its Article 195, III, explicitly provides that social security will also be financed through resources from municipal budgets and revenue from lotteries and similar games of chance.
The preliminary, single-judge decision denies the administrative autonomy enshrined in Article 18 of the Federal Constitution, reverting to the old confusion between legislative and material competence. The decision states that the municipalities usurped the normative competence of the Union. However, by enacting authorizing laws, the municipalities exercise their material administrative competence to exploit modalities already provided for in federal law. The political-administrative competence to provide a public service (Article 30, V, CF) carries with it a portion of instrumental normative competence to make it viable.
The decision relies heavily on the argument of the risk of money laundering, citing the difficulty of monitoring more than 5.000 municipalities; however, with all due respect, the decision cannot alter the division of constitutional powers. The maxim that misuse does not negate use applies. Obviously, the difficulty of monitoring does not render the activity unconstitutional.
It is unusual for a single-judge decision, invoking the exception of "extreme urgency" (Article 5, § 1, Law 9.882/99), to suspend laws that have been in effect for years, such as those of 2021 and 2022 mentioned in the decision itself. Decisions on the constitutionality of laws are the responsibility of the full court, since laws are presumed constitutional until a contrary decision is reached, guaranteeing full defense and due process. The summary and abrupt suspension of consolidated public policies not only weakens legal certainty but also exposes the Judiciary itself.
Certainly, the most delicate point of the decision lies in its impact on legal certainty and existing contracts. The decision disregards concession contracts and public-private partnerships that were signed in good faith, supported by current legislation and the jurisprudence of the Supreme Federal Court (ADPFs 492 and 493). The abrupt preliminary suspension of these legally valid acts violates the principle of protection of legitimate expectations, generating incalculable losses for investors and municipalities that have acted strictly within the law until now. The suspension of municipal regulations governing lotteries directly affects already consolidated legal acts, creating a scenario of insecurity for citizens, investors, and public managers.
In light of this, the preliminary injunction in ADPF 1.212, by suspending municipal regulations and imposing severe sanctions, lacks adequate justification and disregards essential principles of the Supreme Federal Court's jurisprudence. The protection of legally perfected acts, the autonomy of federative entities, and legal certainty are pillars that must be respected. The decision not only undermines trust in institutions but may also generate detrimental economic effects for a significant number of municipalities that have already implemented their local legislation. It is up to the full Supreme Federal Court to decide on this matter, and we trust in the legal wisdom of the other justices. We will continue to democratically defend the federative pact of cooperation and respect for the Federal Constitution, as it is entirely and deservedly just.
(*) Paulo Horn is a founding partner of Paulo Horn Advocacia. President of the Special Commission on Lottery Games of the OAB/RJ (Brazilian Bar Association, Rio de Janeiro chapter), Member of the Commission on Gaming Law of the OAB/DF (Brazilian Bar Association, Federal District chapter) and of the Commissions on Games, Betting and Responsible Gaming of the OAB/SP (Brazilian Bar Association, São Paulo chapter) and Special Commission on Sports, Lottery and Entertainment Games, Federal Council of the OAB. Master in City Law from UERJ (Rio de Janeiro State University). Member of the Brazilian Association of Political and Electoral Law – ABRADEP. Member of the Constitutional Law Commission of the OAB/RJ and the IAB (Brazilian Institute of Lawyers). He has held the positions of administrative and financial director, legal director and vice-president of the Rio de Janeiro State Lottery – Loterj.
