I went through the process of investigating the different State laws and required permits for a giveaway I did in August 2012. Following is a guide to how run a random draw giveaway on your blog, based on the giveaway I ran using Rafflecopter. You can also read some thoughts on the practicalities of using Rafflecopter and running giveaways here.
The guide below is relevant to giveaways open to Australian residents for a trade promotion promoting a businesses good or services, with a total prize pool less than $5,000. The giveaway was promoted online only and was randomly drawn using an electronic drawing system (Rafflecopter). If your giveaway differs from this, there may be other regulations and permits that apply.
The information I provide here is a guide only, based on what I was able to determine from my research with each of the State authorities that govern trade promotions and lotteries. It is not a definitive source and at the time of reading, may not be up to date. Please ensure you fully understand the rules that apply to your particular situation before proceeding with a giveaway on your blog or applying for the appropriate permits.
What is a giveaway and how are they regulated?
In most states, an online giveaway that promotes goods or services provided by a business is termed a Trade Promotion or Trade Promotion Lottery. As the owner of the site running the giveaway, you are responsible for following the appropriate rules and applying for the applicable permits, even if it’s not your own products or services you are giving away.
Do I need a permit?
If you are running a ‘game of skill’ giveaway where the winners are judged solely on the strength of their answer, then you most likely will not require a permit. BUT you may still be required to meet the terms and conditions in each State for running a trade promotion. If your giveaway involves any element of chance at all then you need to refer to the rules for ‘game of chance’ promotion.
Note: Asking a skill question to enter the giveaway and then drawing a winner randomly is considered a ‘game of chance’ or ‘random draw’
If you are running a random draw giveaway then the requirements for a permit will depend on who is eligible to enter your promotion. If you are allowing all residents of Australia to be eligible for entry then the bottom line is that you will require a permit from NSW. Here are the permit requirements for each State with a link to their regulations:
No permit required
Queensland Giveaway Regulations
No permit required
Northern Territory Giveaway Regulations
ACT Giveaway Regulations
If a promotion involving a lottery is conducted via a website a permit is not required unless the website is hosted in the ACT, or the website is not hosted in the ACT but the promotion is being advertised in the ACT in addition to the advertising on the website. Any advertising on social media ie Twitter or Facebook is considered to be advertising in the ACT, so you pretty much need a permit, or need to exclude ACT.
No permit required
Tasmania Giveaway Regulations
No permit required
Victoria Giveaway Regulations
Permit required ($80 fee for promotion $10,000 and less)
Allow 10 working days for processing (better to plan for 15 working days, although my online application was approved overnight)
NSW Giveaway Regulations
No permit required
SA Giveaway Regulations
If using random.org, Rafflecopter or any other form of electronic drawing system, you need to apply for approval. It is free but there is a process involved – see Drawing section below.
No permit required, but you need to lodge T&C with them via email: firstname.lastname@example.org. Just send them an email with “Notification of T&C for Trade Promotion” in the subject.
WA Giveaway Regulations
What regulations do I need to follow?
Regardless of whether you are required to apply for a permit, there are regulations set by each State on how to legally run a trade promotion. Following is a guide based on the minimum requirements and the State in brackets that it applies to. If you allow for these you should meet the requirements in each State (pending any changes to regulations).
- Must be free, but you can require your readers to buy a product or service to enter. There are regulations regarding other entry methods like mobile phone calls or texts which I won’t go into here.
- If any of the prizes are prohibited from sale to someone based on their age, then they are not eligible to enter eg liquor to under 18 year olds
- Employees, immediate family members, retailers, suppliers, associated companies and agencies are not eligible to enter
- Giveaway MUST be drawn at the time, date and place advised in the Terms and Conditions
- Note: you can video or do a screencast of the draw in progress for your records
- The NSW permit will require an address of the place where the draw will take place. I used our local library to protect my privacy.
- Prizes must be drawn in descending order of value (unless you have applied for approval to do it otherwise from each State and include the method in your T&Cs)
- If using an electronic drawing system, you need to apply for approval to use the system (SA only)
- The approval process is free (application form and info)
- It can take up to 3 working weeks to approve, you only need approval in time for the draw date.
- Once your EDS is approved you can use your permit to cover subsequent draws using the same system
- With your application form you need to provide:
- Independent testing report (independent verification that it produces a random fair result and that you know how to use it)
- Process report (a report showing you know how to use it, outlining the steps involved with screenshots)
- All States require you to adhere to laws around the supply of prohibited or restricted goods like alcohol and tobacco. Ensure your prizes are compliant with each State if you are unsure.
- Liquor CAN NOT be the principal prize (NT)
- Liquor CAN NOT be used to induce someone to enter ie everyone who enters gets a bottle of wine (SA)
- The maximum quantity of liquor given as a prize is 20l (NSW)
- The minimum fulfillment time (ie the time you have to deliver the prize to the winner) is 28 days (VIC/QLD)
- The minimum requirement is to retain an unclaimed prize for 3 months, after which time you need to apply for approval for a re-draw, stating all attempts made to contact the winner (NSW).
- Winners must be notified within 2 days of their win with details of how they can claim their prize (NSW)
- If your giveaway was promoted solely via your blog then you only need to publicise the winners on your blog
- For any prize greater than $250 value (VIC) or $500 (NSW) that was advertised somewhere other than your blog, you may be required to advertise the winner in the print publication in which it was advertised or in a circulating newspaper in the appropriate region/State (NSW/VIC)
- You cannot use Facebook to advertise the winners of any promotion (other than saying, winners announced on the blog today, with a link)
Admin and Record Keeping
- You need to keep accurate records of entries and prize distribution for 5 years (QLD). Other States only require between 3-12 months.
- You must advise entrant of how their contact details may be used and get their permission to use their details to send prizes or to subscribe them to newsletters
- You need to have written authorisation from the businesses participating in the giveaway
What do I include in my Terms and Conditions?
Your Terms and Conditions will need to state:
- the name of the promotion
- the name, ABN, address and phone number of the Promoter (use a PO Box to protect your privacy)
- the conditions of entry (including the minimum age of the participants)
- the closing date and time for the receipt of entries in the lottery
- the place, date and time of the lottery draw
- how prizes will be awarded
- the method for claiming prizes (including any requirement for entrants to be present at the draw)
- how prize-winners will be notified
- how the results of the lottery will be published
- details of the prizes and their value (including conditions, if any, relating to receiving, accepting or using the prizes).
It may also useful to include the following conditions (as appropriate):
- Prizes are not redeemable for cash
- Prizes are not transferable
- If for any reason beyond the Promoter’s control the agreed prize is not available a product of equal or greater value will be provided.
- The Promoter is not responsible for prizes once they have been dispatched to the winner.
It is important that you check your Terms and Conditions and ensure they are accurate. If you need to change them at any point you will need to pay a $100 fee to change your NSW permit, and you will also need to get approval from the other States to make changes or cancel the giveaway after it has commenced.