Body
After a previous bidding process was annulled in July, the Brazilian state of São Paulo has published another international tender for an exclusive concession to operate a state lottery.
Just like last time, the tender will award the operation of the lottery and its associated products, including fixed-odds sports betting, to a single company.
The state of São Paulo is home to 46m people, making it more populous than every country in Latin America except for Mexico, Colombia and Brazil in its entirety.
State lotteries became authorised to operate in Brazil after an October 2020 Supreme Court ruling found that a 1967 decree making the federal government the exclusive operator of all lotteries in the country was unconstitutional. In the two years since, dozens of state and municipal governments have taken steps to either expand or establish local lottery operations.
In São Paulo, the chosen operator would hold the licence for 20 years through a contract that has an estimated worth of R$935.4m, or nearly US$185m. The contract includes the operation of sports bets, as well as traditional lottery draw and instant games. All lottery games could be offered through virtual as well as physical channels.
The bids must include a guarantee of R$9.34m (US$1.81m) that is valid for 180 days.
Permission to allow the lottery to be operated by the private sector was first granted by the governor in February; however, an initial tender process was cancelled at the end of March amid protests from potential bidders. At the time, lawyers argued that the tender favoured local bidders.
Meanwhile, the city of São Paulo, home to more than 12m people, has positioned itself to reap the benefits of the lottery and other forms of expanded gambling in Brazil.
Mayor Ricardo Nunes on November 1 proposed a bill that would reward companies offering lottery games, sports betting, fantasy sports and future gambling products with the lowest possible local services (Imposto Sobre Serviços, or ISS) tax rate.
The ISS is a municipal service tax in Brazil, with rates that vary from 2 to 5 percent. The mayor hopes to attract sports-betting businesses to the city with the tax rate advantage, once a federal regulatory decree is adopted to implement a 2018 federal law authorising sports betting at a national level.
The bill is still only a proposal of the mayor and will need to be debated and approved by the São Paulo city legislature.