The Rio de Janeiro State Lottery (Loterj) has reopened its licensing window for operators seeking to legally offer fixed-odds sports betting and iGaming services in the state, following the withdrawal of a legal appeal. The new accreditation period, which began on September 5, will remain open for 15 days.

Loterj’s decision to reopen applications comes after it dropped its appeal against a ruling by the Rio de Janeiro Federal Regional Court. The court had previously suspended a ruling that mandated the National Telecommunications Agency (Anatel) to block operator sites without a Loterj license. The court extended the transition period for companies to secure federal licenses until January 1, 2025.

The state lottery offers a more attractive licensing alternative compared to the federal system. A Loterj license costs BRL5 million ($1 million) for five years, with a lower tax rate on gross gaming revenue (GGR) and less stringent compliance requirements. By contrast, the federal license costs BRL30 million and involves more rigorous regulation.

Loterj claims its funding has contributed significantly to social initiatives in Rio de Janeiro, helping the state government increase investments in social projects nearly fivefold over the past three years. Companies such as Pixbet and Caesars Sportsbook are already operating in Rio under Loterj licenses.

However, Loterj’s actions have stirred controversy. The Brazilian Institute for Responsible Gaming (IBJR) criticized the state lottery, accusing it of overstepping its remit and violating federal regulations. The IBJR argues that Loterj’s claims that its licensees can operate nationally contradict the federal market’s still-pending launch.

“Loterj’s actions create disorder, raise unnecessary doubts, and harm the process of regulating the fixed-odds betting industry in Brazil,” the IBJR stated in April.

Neil Montgomery

Despite legal challenges, Neil Montgomery of Montgomery & Associados noted that Loterj’s less demanding licensing terms have generated significant interest among operators. He believes that operators may continue to pursue state licenses as legal battles unfold.

“While Loterj’s ‘extraterritoriality’ is currently being challenged in court, it may well be that a long time will pass until the matter is definitely settled by Brazil’s high courts, which could well mean that such a state license has the potential of providing its holders with the expected returns,” Montgomery said.

As of the previous licensing window closure on August 14, Loterj had reportedly received nearly 50 requests, underscoring the demand for its more favorable terms.