DECENTRALIZING THE UNLOCATABLE: NIGERIA’S SUPREME COURT,DIGITAL GAMBLING,and THE LIMITS of TERRITORIAL FEDERALISM

I. INTRODUCTION

The Supreme Court’s unanimous decision in Attorney-General of Lagos State & Others v Attorney-General of the Federation & Others, decided in November 2024 after 16 years of litigation, declared the National Lottery Act invalid and classified lotteries as residual matters within exclusive state competence. The holding is constitutionally unimpeachable. The problem is not what the Court decided, but what it could not have considered: the gambling market it sought to allocate between jurisdictions no longer recognizes those jurisdictions as meaningful boundaries.^1,2,3

This commentary analyses the judgment’s regulatory consequences for digital sports betting in Nigeria, examining the constitutional logic, the deterritorialized nature of internet gambling, comparative experience from analogous jurisdictions, and the structural tensions that now persist.

II. THE JUDGMENT AND ITS REASONING

Nigeria’s constitutional architecture assigns residual matters to the State Houses of Assembly. Gambling and lotteries appear on neither the Exclusive nor the Concurrent Legislative Lists, and the federal government’s claim rested on asserting the National Lottery Act as a valid exercise of ancillary constitutional powers. This ambiguity produced overlapping authority between the National Lottery Regulatory Commission (NLRC) and state lottery boards, exposing operators to inconsistent licensing and enforcement standards.^4,5,6

The Court’s ruling extinguished the NLRC’s authority across all 36 states, confining federal jurisdiction to the Federal Capital Territory. Licenses previously issued by the NLRC for state operations are now of questionable validity, and a regulatory vacuum exists in states yet to develop their own frameworks. ⁷

The federalism rationale has real merit for physical gambling establishments, where operator, consumer, and regulator are colocated. The difficulty lies in the assumption embedded in the reasoning that gambling is, in any meaningful sense, only a territorial activity.

III. THE DIGITAL GAMBLING PROBLEM: JURISDICTION WITHOUT TERRITORY

Digital sports betting shatters the territorial anchors on which Nigerian gaming regulation was built. A bettor in Imo State can place a wager in real time through a platform operated from Lagos, licensed in Gombe State, running on servers in Dublin, and processing payments under entirely different statutory regimes. No single moment in that transaction is unambiguously located within any one state’s territory and the question of which regime governs is structurally unanswerable within a purely territorial framework. ⁸

Three consequences follow. First, regulatory arbitrage becomes inevitable as operators have strong incentives to license in whichever state offers the most permissive environment while serving consumers everywhere else. The Federation of State Gaming Regulation in Nigeria (FSGRN), a voluntary committee of some state regulators, has acknowledged this risk in its proposed Universal Reciprocity Licensing Regime, but that proposal remains aspirational and without legislative foundation. ⁹

Second, responsible gambling protections become territorially incoherent. Nigeria already faces significant deficits in treatment infrastructure and public awareness of gambling harms. ¹⁰ While the NLRC has historically maintained national standards through the National Lottery Regulations 2007, ¹¹ a fragmented regulatory regime risks 36 divergent standards. For example, a self-excluded problem gambler in one state faces no barrier when accessing a platform licensed in another. The protection is jurisdictionally bounded; the harm is not.

Third, enforcement gaps proliferate. Regulators lack the authority to compel compliance from operators licensed elsewhere or block foreign platforms. This is not a novel problem: Araromi, Gainsbury and Wood, and Onuche each identified the absence of clear online gambling provisions as a critical gap. The judgment compounds it, devolving authority to 36 jurisdictions, each of which must independently develop infrastructure to regulate an inherently borderless activity.^12,13

It should be acknowledged that state-level digital enforcement is not technically impossible, as geolocation, age verification, IP blocking, and National Identification Number (NIN) or Bank Verification Number (BVN) identity checks are all deployable. The objection is not that states lack the tools; it is that those tools only work effectively when deployed uniformly. A state requiring BVN verification alongside one that does not create precisely the arbitrage described above. Each state’s individual capacity is therefore beside the point. The structural problem is coordination, and no amount of unilateral sophistication resolves a gap that is, by definition, interjurisdictional.

IV. COMPARATIVE SIGNALS: WHAT OTHER JURISDICTIONS REVEAL

In the United States, Murphy v National Collegiate Athletic Association struck down the federal PASPA regime and returned sports betting to the states, mirroring the structural logic of the Nigerian judgment. By the end of 2024, legal sports betting operated in 38 states with materially divergent standards on advertising, tax rates, and consumer protection. Till date no federal minimum standards framework has been enacted. Decentralization without minimum standards produces regulatory fragmentation, not regulatory diversity.^14,15

The United Kingdom took the opposite approach, establishing a single national regulator, the Gambling Commission, with jurisdiction over all gambling activities through a unified Licence Conditions and Codes of Practice framework. Consumer protection standards, including affordability checks and self-exclusion through GamStop, apply uniformly to every operator serving UK consumers, demonstrating that a unitary digital framework is both legally achievable and operationally workable across distinct geopolitical territories.^16,17

The European Court of Justice has consistently required that national restrictions on cross-border gambling services be proportionate, transparent, and consistently applied ¹⁸ (Zeturf Ltd v Premier ministre ¹⁹ ). These are conditions that are difficult to satisfy across 36 divergent state frameworks.

V. CONCLUSION: THE RIGHT ANSWER TO THE WRONG QUESTION

The Court answered the question before it correctly: State governments hold legislative competence over lotteries. The difficulty is that the more important question of how a federal state regulates a functionally borderless industry was not before the Court. ²⁰

What the judgment produces is structural obsolescence. A framework calibrated for physical gambling establishments now governs an industry in which the dominant mode of participation is digital, mobile, and indifferent to state borders. Nigeria’s gambling industry is projected to reach US$3.63 billion in revenue by the end of 2025 - making the regulatory incoherence it currently operates under not merely a legal inconvenience but a profound economic liability. The FSGRN’s reciprocity proposal is a pragmatic response, but it remains voluntary and without the coercive architecture needed to bind nonparticipating operators. ²¹

Recent developments have made the fragmentation permanent rather than transitional. On December 2, 2025, the National Assembly passed the Central Gaming Bill, seeking to restore federal authority over gaming. President Tinubu publicly refused assent to it, and the AGF, who had himself acknowledged at the Supreme Court’s legal year opening that federal competence over gaming had been extinguished, aligned with that position. ²²

The judiciary, executive, and legal establishment have collectively foreclosed the federal legislative route. The fragmentation is now, in constitutional terms, permanent. What remains is a structural condition requiring interstate coordination through voluntary compacts. Whether the FSGRN’s reciprocity mechanism can bear that weight, given competitive regulatory interests and the absence of statutory compulsion, is the defining question Nigerian gaming governance must now answer. Nigeria already faces documented deficits in problem gambling treatment infrastructure, compounded at precisely the moment the market is most exposed.^23,24

VI. DATA AVAILABILITY

Data sharing is not applicable to this article as no datasets were generated or analyzed during the current study.