LEMG holds public hearing to discuss the concession of Instant and Conventional Lotteries in physical format.

With the presence of several representatives from the segment, Loteria Mineira held a public hearing this Thursday (26) to obtain contributions from the lottery market in order to publish the Notice and carry out a tender for contracting a company to operate instant and conventional (passive) lotteries, exclusively in physical form.

The General Director of LEMG, Ronan Moreira, opened the hearing by greeting and thanking those present, as many of them had traveled from other states to participate in the meeting. Following this, the president of the Bidding Committee, Antônio Celso Alves Pereira Filho, conducted the proceedings and gave a presentation outlining the main characteristics of the tender.

Among those present were representatives from the three companies that submitted studies for the Expression of Interest Procedure (PMI) convened by the Minas Gerais Lottery last year. Roberto Quattrini represented the Estrela Consortium, which includes IGT and Scientific Games, Alexandre Manoel represented AM & FPA, and Gustavo Mantovani represented Intralot.

In addition to the companies participating in the PMI, several other potential operators or service providers were present at the session and offered their opinions, including contributions and criticisms of the tender.

The CEO of Hebara, a Rio de Janeiro-based operator that has been in the lottery market for almost three decades, Amilton Noble, was the first to speak and opened the proceedings by congratulating the Minas Gerais Lottery for having carried out all the processes properly, with a public consultation prior to the public hearing, which represents best practices for this type of bidding process. Furthermore, he highlighted that all those present would have the freedom to express their contributions and criticisms without time limitations, unlike what occurred in other states.

After making some suggestions to improve and clarify the wording of several contractual clauses, the Hebara representative strongly criticized the requirement for prior experience of 150 million tickets in a given year (the target for the last year), while the proof of conventional lottery experience required is less than the target for the second year of the contract, which represents a double standard for the same bidding process.

Next, Roberto Quattrini (IGT-SG) highlighted the need to clarify which items can be outsourced, and suggested that the Data Center be installed in the cloud. He also recommended changes to the tie-breaking criteria for the bidding process.

Alexandre Manoel (AM & FPA) expressed his concern regarding the legal uncertainty surrounding the operation of state lotteries, due to the lack of a complementary law that would guarantee operational security. He also warned that states are not considering mandatory social security contributions in their processes.

Representing SDL Loterias – the company that currently operates LEMG's instant lotteries – lawyer Marcos Vinicius corroborated the concern previously expressed by the AM & FPA representative regarding legal uncertainty, in addition to presenting arguments found in the legislation that would not recommend contracting under an exclusivity agreement.

NGT was represented by lawyer Ricardo Feijó from Paraná, who requested clarification regarding the lack of publication of the PMI results and the lack of indication of which studies were considered valid by LEMG. He also expressed surprise at the criterion used to require proof of R$ 150 million in instant lottery sales experience, equivalent to 100% of the last contractual year, which would not be usual in public tenders. He highlighted that the criterion of increasing percentages for guarantees is not best practice, as it should be the reverse: higher percentages at the beginning of the contract when the relationship with the operator is unknown, and which can decrease over time when the operator's efficiency can be attested by the Minas Gerais Lottery.

Marcos Gravio, representative of the printing company Autopel, emphasized the importance of having quality requirements for the printing company, even if the contract is made directly by the operator.

Next, Intralot's lawyer, Marcello Augusto Lima Vieira de Mello, spoke, reinforcing the statement made by the NGT representative regarding the contractual guarantees, which should have a recent percentage and not an increasing one as stated in the tender. He also highlighted the need for detailed information about the Management Team foreseen in the contract draft and congratulated LEMG for adopting the arbitration model to resolve potential contract disputes.

Concluding the session, lawyer Daniella Soares de Miranda presented relevant contributions, such as the need for the tender to establish the transition criteria between the current instant lottery operator and the new operator. Another point raised was the lack of presentation of studies that supported LEMG's decision to tender the products exclusively in physical form, which represents a rigidity, especially for a 20-year contract that may be renewed for another 20 years.

In addition to those who spoke, the following were also present: consultant Edson Kikuchi, Ferdinando Fiche from MCE, Valter Delfraro Jr from GLI, and José Renato Vale, representative of a French company that supplies equipment for raffles.

At the end, the chairman of the Bidding Committee expressed his gratitude, drew up the minutes, and requested that those present submit their contributions in writing by June 03rd.