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Brazil's ex-president Luiz Inácio Lula da Silva could run against incumbent Jair Bolsonaro in next year's election: A Supreme Court judge overturned the corruption rulings against the former head of state and referred the proceedings to a federal court in Brasília.

The decision hit like a bomb on Monday, because the still popular left-wing politician has a good chance of replacing the radical right-wing Bolsonaro.

Judge Edson Fachin overturned all four of Lula's verdicts.

He argued that the court in Curitiba, southern Brazil, which had brought all the trials against Lula, had no jurisdiction.

The cases now have to be reopened before the federal court in Brasília.

If the judgments are not reinstated there, the 75-year-old can run for election.

The Brazilian Attorney General can appeal the decision to the entire Supreme Court.

"This is recognition that we were right during this long litigation," said Lula's lawyers.

His labor party PT proudly announced on Twitter: "Lula innocent".

18 months in prison, released in November 2019

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The cases go back to investigations into the corruption affair "Lava Jato" (car wash) around the state oil company Petrobras: Petrobras is said to have awarded contracts to construction groups and other companies on overpriced terms;

these in turn paid bribes to politicians and parties.

In the course of years of investigation into the largest corruption scandal in the country's history, a number of politicians and managers ended up in prison, including Lula.

The Curitiba court found the ex-president guilty, among other things, of obtaining a luxury apartment in this way and diverting illegal funds to his foundation.

The former metal worker, who headed the state from 2003 to 2010, always rejected the allegations as politically motivated.

But its image was badly damaged.

Lula spent 18 months in detention before being released in November 2019 - his lawyers had requested his release following a Supreme Court ruling that detained convicts only after all legal remedies had been exhausted.

Due to his conviction, Lula was also not allowed to run in the presidential election in October 2018.

He had always been in the lead in the polls.

São Paulo stock exchange crashes by four percentage points

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According to a survey by the Ipec Institute last Sunday, Lula would also be Bolsonaro's only serious challenger in the October 2022 election and could even garner more votes than the incumbent.

But the ex-president remains controversial: the news of the Supreme Court's decision in his favor caused the São Paulo stock exchange to crash by four percentage points.

Judge Fachin had "always had a strong connection to the PT," Bolsonaro denounced the decision in a statement in front of the presidential palace.

He doesn't think the Brazilians wanted a PT candidate in 2022 - "especially not him".

Lula's supporters did not accept the allegation and instead referred to the involvement of the then judge Sergio Moro in the trials against Lula.

Moro later became Minister of Justice under Bolsonaro.