Betting market reacts to advertising ban in Rio: "unconstitutional" and "electoral opportunism"
Less than 24 hours after the federal interministerial decrees on sports betting advertising came into effect, the Rio de Janeiro City Hall issued Decree No. 58.274/2026 on Monday (July 13), prohibiting all advertising of betting platforms in public spaces and outdoor media in the municipality. The speed of the move is symptomatic of a phenomenon that is repeated in at least three cities and one state: in the absence of a consolidated federal framework, subnational entities are encroaching on regulatory territory that the Federal Constitution can reserve exclusively for the Union.
The underlying question is whether they have the authority to do so. The Supreme Federal Court should answer that soon.
The Rio de Janeiro decree and its legal strategy.
Decree No. 58.274/2026 covers trademarks, websites, applications, promotions, bonuses, mascots, logos, and any identifying element of fixed-odds betting platforms. Its scope is total in the area of outdoor media; billboards, large screens, and street furniture are excluded from the sector's advertising regulations. The decree does not address digital and television advertising, which remains under federal regulation.
The choice of regulatory instrument was deliberate. By using a decree instead of a bill, Mayor Eduardo Cavaliere circumvented the need for approval by the City Council, accelerating its entry into force. The legal rationale followed the same logic of efficiency; instead of creating a new category of prohibition, the decree frames betting advertising as a type already prohibited by Municipal Complementary Law No. 269/2023, which prohibits advertising "offensive to morals and good customs." The constitutional basis invoked is the municipal competence over urban planning and land use, provided for in articles 30 and 182 of the Federal Constitution, and not the regulation of the betting sector itself.
This distinction is the central piece of the intended legal protection. By positioning itself as a regulator of urban public space, and not of the betting market, the municipality attempts to distance itself from the exclusive competence of the Federal Government. It also reinforces this with Federal Law No. 14.790/2023, which mentions impacts on mental health, especially of children and adolescents, as grounds for restrictions.
The strategy, however, has an inherent cost: the fragility of the instrument. A decree can be revoked by another decree. A law passed by the legislature would require the reverse process to be undone.
Criticism of the sector; unconstitutionality and perverse effect.
According to lawyer Fabio Ferreira Couto, from Carvalho Couto Advogados, the decree does not withstand constitutional scrutiny. "From a technical-legal standpoint, the measure is blatantly unconstitutional," he stated in a LinkedIn post. "Article 22, item XX, of the Federal Constitution is crystal clear; it is the exclusive responsibility of the Union to legislate on consortium and lottery systems."
Couto goes beyond the discussion of competence. For him, the measure produces an effect that contradicts its stated objectives. “The decree promotes a blind 'witch hunt,' lumping together legitimate companies and criminal platforms,” he stated. “The illegal platforms, which represent more than 50% of the market, continue to operate in the shadows of the digital environment, untouchable by municipal decrees.”
The lawyer's central argument is that the total ban punishes precisely those who are operating within the law. "The Rio de Janeiro decree completely ignores this federal regulation. By prohibiting everything, the City Hall severely punishes legitimate companies that have invested millions in sponsorships, generate jobs, and pay taxes," he argued. According to Couto, the Federal Government, through the Secretariat of Prizes and Betting (SPA) of the Ministry of Finance, has already issued strict regulations on risk warnings and abusive advertising, and the municipal action, without coordination, imposes a total ban on this already existing regime.
The lawyer classified the move as electoral opportunism. "It's a perfect example of how the eagerness for an electoral platform can trample the Federal Constitution and stifle the business environment in Brazil," he wrote.
Along the same lines, a sector leader pointed out that Mayor Eduardo Cavaliere, behind the "moralistic discourse of 'offensive to morals and good customs,' which would make Dona Santinha blush, 'protection of the urban landscape,' and 'mitigation of socioeconomic impacts,' hides a political maneuver full of legal flaws."
Rio is not alone, but each case is different.
The decree from Rio de Janeiro is part of a broader movement of subnational entities seeking to restrict betting advertising before the federal government consolidates its regulations.
In João Pessoa, Ordinary Bill No. 302/2025, approved by the City Council, awaits the mayor's signature. Its scope is more comprehensive in specific areas; in addition to public equipment and media outlets, the João Pessoa legislation explicitly includes uniforms and school supplies for municipal programs, and stipulates that the proceeds from fines be allocated to social funds—two elements absent from the Rio de Janeiro decree.
Belo Horizonte illustrates the most tortuous path. Two bills have been under consideration in the City Council since 2025: Bill 297/2025, by councilman Pedro Rousseff (PT), which restricts advertising and prohibits sponsorship of sporting, cultural, civic, and educational events by companies in the sector; and Bill 362/2025, by councilman Wagner Ferreira (Rede), which prohibits any form of advertising for online betting , including giveaways, coupons, and access kiosks. Both were approved in the first round with 33 votes in favor, but the final vote was removed from the agenda in June due to an assessment that there would not be the necessary 21 votes. The return date remains undefined.
With the legislature stalled and the Arraial de Belô festival scheduled to begin on July 24th, the Public Defender's Office of Minas Gerais recommended that the city government remove advertisements for betting sites from public transportation. Two city councilors filed a class action lawsuit, and the result was swift; Judge Danilo Couto Lobato Bicalho suspended the advertising on buses and at boarding points, annulling the authorization seals issued by BHTrans and Sumob, with daily fines ranging from R$ 50 to R$ 200 per defendant and a ceiling of R$ 30 million in case of non-compliance. The same lawsuit questioned the contract between Belotur and Esportes Gaming Brasil, brand "Esportes da Sorte," for the sponsorship of the festival, a modality that the Rio de Janeiro decree already prohibits preventively in its article 6.
The pattern connecting the three cases is the same; all resort to the authority to police land use and advertising, combined with the protection of children and adolescents, deliberately avoiding addressing the regulation of the betting sector itself. The reservation of this authority to the Federal Government, by Law No. 14.790/2023 and the interministerial decrees of July 2026, is precisely the area that no municipality wants to openly contest.
RS and the leading case that could redefine everything.
The most legally relevant case in the national scenario is not the decree from Rio de Janeiro; it is Law No. 16.508/2026 from Rio Grande do Sul, sanctioned by Governor Eduardo Leite on April 24, 2026, and currently under challenge in the Supreme Federal Court in ADI 7.971.
Unlike municipal initiatives, which limit their actions to the local physical space, the law in Rio Grande do Sul regulates the advertising of betting platforms broadly, establishing limits for campaigns, sponsorships, and marketing actions throughout the state. The requirements are stricter than federal regulations in central areas;
⇒ Mandatory warnings in at least 15% of the ad space, with audio quality equivalent to that of the main ad, in addition to information about addiction and psychological support channels; the federal standard is 10%;
⇒ Advertising is prohibited in stadiums, gyms, sports arenas, and public performance venues, with the exception of official event sponsors;
⇒ Restrictions on TV, radio, streaming , and video-on-demand broadcasting hours from 6 AM to 21 PM;
⇒ Prohibition of content aimed at minors, including animations, mascots, or characters appealing to children and young people, and joint liability among platforms, agencies, media outlets, and internet providers.
It is precisely this broad scope that led to two requests for suspension before the Supreme Federal Court (STF). The National Association of Newspapers and Lotteries (ANJL), representing the betting sector, argues that fixed-odds betting is already regulated federally, with states only responsible for operating their own lotteries. This argument adds a practical dimension; without clear parameters, consumers would have more difficulty distinguishing legal platforms from clandestine websites.
The Attorney General's Office (AGU) went further. In its petition, the Attorney General's Office presented four constitutional grounds for suspending the Rio Grande do Sul state law;
⇒ Commercial advertising (art. 22, XXIX, CF): the power to legislate on advertising is exclusive to the Union. The Attorney General's Office argued that Law No. 14.790/2023 and Ordinance SPA/MF No. 1.231/2024 already form a complete federal regime, and that the Rio Grande do Sul state law does not complement it, but contradicts it, invoking precedents from ADI 4761 and ADI 5432, which overturned state laws on advertising for cell phones and medicines.
⇒ Betting as a lottery modality (art. 22, XX, CF): citing the joint judgment of ADPF 492, 493 and ADI 4986, the AGU recalled that the STF had already defined that states can operate lotteries, but cannot legislate on the legal regime of this activity.
⇒ Telecommunications and broadcasting (art. 22, IV, CF): the imposition of time slots and the possibility of blocking websites, present in the Rio Grande do Sul law, would interfere with communication services of national scope; precedents cited include ADI 5575 and ADI 3877.
⇒ Civil and commercial law (art. 22, I, CF): joint liability between platforms, agencies, vehicles and providers would be a matter of civil law, reserved to the Union; precedent; ADI 4228.
The Brazilian Association of Radio and Television Broadcasters (ABERT) requested to participate as amicus curiae , warning of the concrete risk of a broadcast schedule exclusive to Rio Grande do Sul, which would create legal uncertainty and a precedent for each state to formulate its own rules.
Whatever the Supreme Federal Court decides regarding Rio Grande do Sul will have repercussions in the municipalities.
ADI 7.971 is, so far, the most direct test of the limits of subnational competence in the regulation of betting advertising. Its decision will have a ripple effect on the entire regulatory architecture that has been built in municipalities.
If the Supreme Federal Court (STF) suspends or overturns the Rio Grande do Sul state law due to an encroachment on federal jurisdiction, the signal it sends will legally weaken municipal decrees and laws, even those based on a different foundation, namely the power of urban planning policing. The distinction between "regulating advertising" and "ordering public space" may prove insufficient to protect them.
If the Supreme Federal Court (STF) validates the Rio Grande do Sul law, it opens the way for other states and municipalities to legislate in a more restrictive manner than the federal norm, and the pressure on municipalities to follow the same path is likely to intensify.
According to Fabio Ferreira Couto, the response should come first from an articulation within the sector itself. “The moment demands coordination. Regulated betting platforms, especially small and medium-sized ones seeking to operate legally, urgently need to unite through their representative associations,” wrote the lawyer. “We cannot allow political opportunism in an election year to override the Constitution and the development of a regulated and responsible market.”
The decree from Rio de Janeiro is yet another piece of a constitutional puzzle that the Supreme Court has not yet finished assembling.
