Knowing About The Legal Side Of Online Competitions

Posted on: 15th April 2014

This is not an exhaustive description of the competition laws but rather a light yet informative guide about online competitions – its basics and legal requirements.

Regardless of the competition type – game of skill or game of chance – online competitions must provide clear and specific terms and conditions to its consumers. The terms and conditions are usually in fine print. Consumers must read it and understand it thoroughly before getting involved in it so as to determine the legitimacy of the online competition and be aware of their rights and privileges.

What does a consumer have to look in an online competition?

  • The promotional period – when the online competition started and when it would end
  • The competition entry rules – what the entrant must do to qualify
  • Who can be entrants and how often can a person submit an entry – whether a single entry throughout the promotional period or multiple entries everyday
  • The total prize value and the exact description of the prize
  • The draw date and time – where and when the winner/s will be announced

These are just basic stuff that you should look for in an online competition. A comprehensive format of the terms of conditions can fill up several A4 pieces of paper. Note: If any online competition cannot provide any of the following information above, you must think twice in joining it and report it immediately to the local governing body in your specific state or territory.

Competition Permits In Different States And Territories

Western Australia, Tasmania, and Queensland do not require permits for games of chance competitions. On the other hand, New South Wales and Australian Capital Territory both require permits if the games of chance competitions accepts entrants from those locations. The Northern Territory may or may not require permits for games of chance competitions, depending on the nature of the trade promotions. South Australia and Victoria require businesses to get permits if the online competitions offer prizes that have a certain value.

The Illegal Side

Many online promoters run competitions without permits because they rely on hearsays “You don’t need a permit if the prize value is just under $100”. But this is a serious matter. For all website owners who run any kind of online competition, you have to consult with your local government agency that deals with trade promotions because you might be violating the law.

Though permits are not required for games of skill competitions, there are still other factors that need to be considered before running it. Above all, promoters and organizers must prioritise consumer rights and privileges. It is wrong to manipulate the game for the personal goals of the promoter/organizers which could mean legal trouble for the business.

As for the entrant, he or she is not responsible whether the online competition is legally compliant or not. Then again, if terms and conditions do not adhere to what is set by the ACCC, then it says a lot about the promoter/organizer. If ever you encounter a problem with the entry rules and/or claiming of prize, the law can only do so much for you if you have joined even after having conscious awareness that the online competition is crossing a legal line.

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