Rio Court Halts Law Diverting Oil Royalties From Pension Fund to Pay Federal Debt

Overview

• Desembargador Milton Fernandes de Souza granted a preliminary injunction on November 5 suspending the effectiveness of State Law No. 11,010/2025.
• The law would redirect part of oil royalties and special participations from Rioprevidência to service the state’s debt to the Union and, as written, to fund public security until December 2026.
• The judge cited risks to the fund’s solvency and to the security of pension benefits, warning of potential irreparable harm if transfers occurred before a final ruling.
• The state government argues the measure would retain only surplus receipts, would not affect payments to retirees and pensioners, and was duly approved by the state assembly.
• The case stems from a constitutional challenge filed by opposition deputies and now awaits referendum by the TJRJ’s Órgão Especial, with fiscal context including R$4.9 billion of royalties used for debt in 2024 and a projected 2026 deficit of R$19 billion.