Competition Terms and Conditions

Expert Legal Advice

Holding competitions can be a great opportunity for brand exposure, but you need to ensure you have well-drafted, comprehensive Competition/Prize Terms and Conditions to ensure the competition entrants are aware of their obligations and the rights and responsibilities of your business.

What are Competition Terms and Conditions?

Competition Terms and Conditions apply to the operation of a competition where entrants of the competition agree, as a condition of entry, to the terms of the entity holding the competition.

The Terms and Conditions outline the key aspects of the competition including eligibility of entry, the prize, how to enter, any special conditions of entry, when and how the competition winner(s) will be announced, among other things.

There are generally two types of competitions:

1. Games of chance; and
2. Games of skill.

Games of chance don’t require entrants to demonstrate any level of skill and an entrant wins purely by chance. An example of this is where winners are drawn at random.

Games of skill require an element of skill to win the competition and usually has a judge or panel of judges to choose the winner. An example of this is a competition requiring entrants to submit an answer to a question in 25 words or less. This requires the entrant to use a degree of skill to win the competition.

Why is it important to have Terms and Conditions in place for my competition?

Competitions that are considered games of chance must comply with the laws of the state or territory in which the competition is being held that relate to those types of competitions. If a competition is held Australia-wide then it must comply with the relevant Laws and regulations of every state and territory.

Also, for chance-based competitions most states require you to hold a permit to conduct the competition. With an application to obtain a permit you must provide your competition terms and conditions to the government, which is why having competition terms and conditions in place is vital.

It’s also necessary to have terms and conditions for games of skill competitions. This also ensures all parties are aware of their rights and obligations.

See the below links for more information on whether you need a permit for your competition for each Australian state or territory:

• New South Wales: https://www.liquorandgaming.nsw.gov.au
• Victoria: https://www.vcglr.vic.gov.au
• South Australia: https://www.cbs.sa.gov.au
• Tasmania: https://www.treasury.tas.gov.au
• Queensland: https://www.business.qld.gov.au
• Western Australia: https://www.dlgsc.wa.gov.au/racing-gaming-and-liquor
• Northern Territory: https://nt.gov.au/industry/gambling/gambling/lotteries-community-gambling/apply-to-run-a-trade-lottery
• Australian Capital Territory: https://www.gamblingandracing.act.gov.au

What are some key things to include in Competition Terms and Conditions?

Eligible entrants

You may choose to only have entrants as individuals over 18 years of age or you may have specific criteria of eligible entrants. If so, you should clearly state this in the terms and conditions.

Generally, employees and family of employees of the business holding the competition are excluded from entering the competition, so it’s a good idea to include this and any other exclusions in the terms as well.

Number of permitted entries

You should also consider whether you permit entrants to submit an unlimited number of entries in the competition or if they are limited to one entry per person.

How to enter the competition

You should clearly outline how entrants enter the competition and any online forms or questions they need to answer in order to have a chance at winning.

It’s important to also include when the winner(s) will be announced.

The competition period

The dates of when the competition starts and ends is necessary to include in the competition terms and conditions. This makes it clear to entrants when the cut off is for entering the competition.

The prize details

The terms should include specific details of what prize or prizes are awarded to the winner(s) of the competition.

It’s necessary to include how the competition winner will be announced. Will the winner be contacted by phone or email? How will the winner be announced to the public?

Also, the terms should include provisions allowing for the scenario where the winner initially selected isn’t able to be contacted and that in the circumstance a new winner would be selected.

It’s a good idea to include in the terms that if an entrant is selected as the winner of the competition that they agree to be involved in promoting the competition, including being photographed and interviewed and that they agree that your business can use their name, image and likeness for the purpose of announcing the winner to the public and in any articles or social media posts promoting the competition.

Disqualifying entrants

You should consider including circumstances where you can disqualify an entrant if they breach the competition terms and conditions, such as cheating to win the competition by having an unfair advantage or if they act in a way that infringes a third party’s intellectual property (IP).

Disclaimers

Disclaimers act to limit your business’ liability and they’re highly advantageous to include in your terms.

The following are a few examples of disclaimers that can be included in the terms:

• The entrant acknowledges and agrees that if the Prize or Promotion Prize is unavailable, for whatever reason, the Promoter reserves the right to substitute the prize for a prize of equal or greater value, subject to State and Territory legislation.
• The Promoter reserves the right to conduct a redraw in the event that an entrant, claiming to be a winner or qualifier, is unable to satisfy the terms or has breached the terms.
• The Promoter has no responsibility to accept late, lost or misdirected entries.
• Prize-winners acknowledge that tax implications may arise from their prize winnings and they should seek independent financial advice prior to acceptance of that prize.
• Nothing in the terms limit, exclude or modify or purports to limit, exclude or modify the statutory consumer guarantees as provided under the Competition and Consumer Act 2010 (Cth), as well as any other implied warranties under the ASIC Act or similar consumer protection laws in the State and Territories of Australia.

Related: Website Terms and Conditions, Event Terms and Conditions, Photography Terms and Conditions, Recruitment Terms and Conditions, Coaching Terms and Conditions, Terms and Conditions of Business.

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