Lawyers explain ‘problems’ facing investors, states, and  FG over the Supreme Court’s nullification of the National Lottery Act 

The apex court’s recent verdict was based on the grounds that the said act was enacted contrary to the powers of the National Assembly.

The judgment followed a long-running suit initiated in 2008 by the Lagos State government against the Federal Government, which sought a determination over who should control and regulate the lottery and gaming sector.

The Attorney-General of Lagos State, through Wole Olanipekun SAN, had challenged the legislative competence of the National Assembly to make any law for the regulation and control of the operation of the lottery in Nigeria.

He argued that “such matters do not fall within the 68 items exhaustively set out in Part I of the Second Schedule to the 1999 Constitution.”   

In a unanimous judgment, a seven-member panel of the apex court agreed with the Lagos State government’s submissions, holding that the National Assembly lacked the powers to legislate on issues relating to lotteries and games of chance.

Channels Television reported that the court held “such powers only reside with the state Houses of Assembly, which possess exclusive jurisdiction over lottery and related issues.”   

The apex court subsequently quashed the National Lottery Act entirely for contravening the 1999 Constitution.

Speaking to Naijaonpoint in an exclusive interview, media personality and human rights lawyer Barrister Frank Tietie said the judgment of the apex court is a welcome development but a “double-edged sword.”

He explained, “Promotions by banks are also part of the lottery business. Promotions like ‘open an account with N2,000, win N1,000,000’ or ‘buy such-and-such from us, stay in our hotel, and get an all-expenses-paid trip to Dubai.’ All those forms of promotions are deemed to be part of the lottery business.”   

“It’s easy to say that lotteries are under the control and regulation of the state.  

“But when it comes to enforcement of standards and the persons who are able to use such lottery systems, how can a state regulate a lottery business when the consumers are spread across the country? That poses a regulatory challenge.” 

“Mark my words: a uniform national standard. Because if we have many confusing lottery regulations done by the states, we might have a problem,” he said.

Reacting in an exclusive interview with Naijaonpoint, Barrister Opeyemi Owolabi said the implication of the apex court verdict is that the National Lottery Act is void and will no longer be applicable, as states except FCT can now go ahead to enact their respective lottery laws regarding lottery within their territories.

“The states can bring an action to seek an order compelling the FG to account for what it has earned so far or what it is currently earning and make due remittances based on derivation,” he said.

For public interest lawyer Opatola Victor, the apex court’s verdict implies that the act is only applicable and valid within the FCT, while the states can make their own laws regarding lotteries and games of chance.

For public interest lawyer Opatola Victor, the apex court’s verdict implies that the act is only applicable and valid within the FCT, while the states can make their own laws regarding lotteries and games of chance.

“This (the quashing of the National Lottery Act) will lead to a lot of problems for investors and players in the industry. If you have to obey 36 different (lottery) laws or 20 different laws, it’s quite demanding.”   

“For instance, in one country, if all the 36 states enact 36 different lottery laws, it will be difficult for businesses. If one business is following about 36 different laws or 20 different laws, it gets complicated.”   

“The problem investors are facing—or will face—is that they will have to pay a percentage of tax to each state in which their business is operating. That is the problem,” he added.

“That means the lottery business can just go on in that space without any regulation,” he said.

Interpreting the implications of the apex court’s verdict in a statement, Templars law firm also stated that the decision of the Supreme Court is immediately enforceable throughout the Federal Republic of Nigeria based on Section 287(1) of the 1999 Constitution, which provides that “The decisions of the Supreme Court shall be enforced in any part of the Federation by all authorities and persons, and by courts with subordinate jurisdiction to that of the Supreme Court.”   

“The Act will now only apply to the FCT, which is ordinarily within the legislative remit of the National Assembly,” it stated.

“Effectively, they will be required to pay taxes relating to lottery businesses stipulated by the respective laws of the states where they operate and to the state government,” the statement added.

The apex court’s judgment comes several weeks after President Bola Tinubu launched a comprehensive 2024-2028 Strategic Plan to reposition the National Lottery Trust Fund (NLTF) for more effective delivery of community-oriented projects.

During the unveiling of the Fund at the Banquet Hall of the State House in Abuja, the Secretary to the Government of the Federation, Senator George Akume, who represented the President, stated: “Through the National Lottery Trust Fund, the President believes that help will reach many Nigerians, providing support to vulnerable individuals and communities.”   

Section 40(b) of the Act empowers the Trust Fund to also “apply the proceeds of the fund from time to time to the cost of administration of the agency.”