Rio de Janeiro prosecutors challenge decree allowing electronic betting terminals

The Public Prosecutor’s Office of Rio de Janeiro has asked the state court to declare Decree No. 49.804/25 unconstitutional, arguing that the rule improperly authorises electronic betting equipment in commercial venues across the state.

The Public Prosecutor’s Office of Rio de Janeiro has filed a representation of unconstitutionality with the Court of Justice of Rio de Janeiro against State Decree No. 49.804/25. The action was brought before the court’s Special Body by Attorney General Antonio José Campos Moreira and challenges the state government’s authorisation of physical equipment and terminals for electronic betting in commercial establishments.

The decree, signed by Governor Cláudio Castro, created rules for the installation of Video Lottery Terminals, kiosks, smart POS devices and themed lottery venues such as sports bars. Under the model, equipment would be approved and supervised by Loterj, the Rio de Janeiro State Lottery, with operations allowed both in exclusive venues and in non-exclusive commercial establishments where lottery products would be offered as a secondary activity.

According to the MPRJ, the decree goes beyond the limits set by federal legislation. Prosecutors argue that Law No. 14.790/2023 does not allow fixed-odds betting in a virtual environment to be sold through physical equipment installed in commercial establishments. The action also claims that the matter could not be regulated by a state executive decree and that the rule invades the Union’s exclusive competence to legislate on consortium systems, raffles and lottery activities.

The state’s model includes several technical and compliance safeguards. Reports on the decree say access to the terminals would require QR code login, multifactor authentication and biometric identification. Transactions would have to be made through Pix linked to the bettor’s CPF or passport, while cash and card payments would be prohibited. Equipment would also need certification, integration with central monitoring systems, KYC checks and tools for AML, data protection and responsible gambling.

Supporters of the decree argue that the terminals would operate under a centralised lottery system and would not be equivalent to illegal slot machines. They also point to the potential for traceability, job creation and new state revenue. According to BNLData, operators accredited by Loterj would pay R$5 million for a five-year licence and transfer 5% of GGR to the state.

The case will now be analysed by the Special Body of the Court of Justice of Rio de Janeiro. Its decision could determine whether Rio de Janeiro can continue with its planned rollout of electronic lottery and betting terminals, or whether the decree must be suspended because it conflicts with federal law. For Brazil’s gambling sector, the dispute is important because it may define how far state lotteries can go in physical distribution of digital betting products under the current federal framework.