The São Paulo City Council appeals to the Supreme Court against the suspension of the municipal lottery law.
The São Paulo City Council filed an appeal with the Supreme Federal Court against the decision of Minister Nunes Marques that suspended Municipal Law 18.172/2024, which created the public lottery service in the city of São Paulo. The appeal was filed on Thursday (January 22nd) and questions the precautionary measure granted by the rapporteur in the Argument of Non-Compliance with Fundamental Precept (ADPF) 1212.
The São Paulo city council argues that the municipal law has been in effect since July 2024 and is already producing regular effects on public administration. Immediate repeal could compromise the continuity of public services, since lottery activity is classified in this category.
The contested decision, issued on December 3rd, ordered the suspension of the effectiveness of all municipal regulations related to the operation of lottery services in the country, ordering the immediate cessation of ongoing operations and prohibiting municipalities from enacting new regulations related to these activities.
Legal arguments presented in the appeal
In the document sent to the Supreme Federal Court (STF), the City Council cites article 11 of Law No. 9.882/1999: “When declaring the unconstitutionality of a law or normative act, in the process of alleging non-compliance with a fundamental precept, and considering reasons of legal certainty or exceptional social interest, the Supreme Federal Court may, by a two-thirds majority of its members, restrict the effects of that declaration or decide that it will only be effective from the date of its final judgment or from another moment that may be established.”
The agency emphasizes that the regulations challenged in the ADPF (Arguição de Descumprimento de Preceito Fundamental - Claim of Non-Compliance with a Fundamental Precept) go beyond lottery services and affect the entire Municipal Public Administration. Among the potential harms cited are the interruption of the allocation of revenue from lottery services and the paralysis of ongoing bidding processes.
In the preliminary ruling, Minister Nunes Marques classified lottery activity as a public service and based his decision on the exclusive competence of the Union to legislate on consortium and lottery systems, according to article 22, item XX, of the Federal Constitution. He also interpreted that the material-administrative competence to operate these services would be restricted to the States and the Federal District.
Petitions to the Supreme Federal Court
The City Council's main request is that the appeal be heard and granted, with the reporting minister himself reconsidering the decision, as provided for in article 317, § 2, of the Internal Regulations of the Supreme Federal Court. Alternatively, it requests that the appeal be submitted to the Court's Plenary.
The City Council requests the revocation of the precautionary measure, at least with regard to the Municipal Law on lotteries, restoring its effectiveness until the final judgment of the ADPF (Arguição de Descumprimento de Preceito Fundamental - Claim of Non-Compliance with a Fundamental Precept). The body argues that such a measure would respect the presumption of constitutionality of laws and the municipal autonomy guaranteed by the Constitution.
Another argument used by Nunes Marques was that lottery operations would not fall under the concept of "local interest" foreseen in article 30, item I, of the Constitution. The minister expressed concern about regulatory risks and difficulties in oversight, especially in the fixed-odds betting modality, known as " bets ".
Subsidiary request for modulation
If the court does not accept the main request, the Chamber will present a subsidiary request to modulate the effects of the decision with three objectives: to preserve the administrative acts already carried out under the validity of the municipal law, to prevent the immediate application of the established fines, and to guarantee an institutional transition to maintain administrative continuity.
The document also requests that the matter be considered by the full Supreme Court, arguing that the federal issue requires in-depth analysis and collegial deliberation on the precautionary measure, whose effects are considered equivalent to those of a final decision.
The challenged precautionary measure stipulated daily fines of R$ 500 for municipalities and operating companies, in addition to R$ 50 for mayors and directors who fail to comply with the order, amounts considered disproportionate by several municipalities that are contesting the decision.
Only in 2025, after the lawsuit was filed, did approximately 55 municipalities in 17 different states, from all regions of the country, create their own lotteries to operate lottery games and sports betting. There are records of more than 80 municipalities that issued regulations in the last three years creating lotteries.
Minister Nunes Marques' decision will be submitted to a referendum by the full Supreme Court in an extraordinary virtual plenary session to be convened by the Court's Presidency.
