Category Archives: Do I need a competition permit

When do you need a competition permit?

Competition permits are usually required for chance-based competitions. As a result of the different regulations in each State, it can be difficult to work out when a permit is required and how a permit may be obtained. The below sets out when a permit is required in each state.

Game of Skill vs Game of Chance

A competition permit will never be required for a game of skill. To be classified as a game of skill, the competition cannot have any element of chance i.e. competition draw involved in the determination of winners. Examples of games of skill include those asking entrants a question with answers then judged on the basis of merit and photo or video submission competitions.

A mixed game of skill/ game of chance would be considered a game of chance.

The below summary relates solely to games of chance.

NSW

A competition permit will be required regardless of your prize pool. NSW are the cheapest and quickest State, so you can set up a competition in NSW with ease, provided that your terms and conditions comply with the various requirements.

NSW require an independent (or approved non-independent) scrutineer of draws over $10k in value.

SA

A competition permit will be required regardless of your prize pool if your competition is instant-win.

Otherwise, i.e. if you are simply drawing your winners, you will only need a competition permit from SA if your prize pool is over $5,000. Allow significant time for SA to issue a competition permit if required.

A particular requirement of note in SA is that you must use approved software if you are drawing your competition winners electronically.

SA require an independent scrutineer of draws over $20k in value.

ACT

ACT changed their laws in November last year. You will now only need an ACT permit if your prize pool is over $3,000. There are some exceptions to the need for permits but if you plan to promote your competition on social media, or in print or TV, these will not apply.

NT

If your prize pool is over $5,000, however a permit is never required if you have a permit from another state. i.e. if you run a national competition and obtain a permit from

WA

All competitions must comply with the permit conditions found on the regulator’s website, but there is no need to apply for a permit here.

TAS and VIC

No need for a competition permit in either VIC or TAS.

QLD

No need for a permit here. As in SA, you use approved software if you are drawing your competition winners electronically.

About us

Our work is covered by PI insurance and we guarantee that we will obtain the permits you required. Unlike other providers we apply for permits online, saving extra permit fees and reducing the time it takes to obtain permits.

Permitz Group has a very straight forward briefing process and can provide you with terms and conditions within 24 hours.

Obtain an obligation fee quote today.

 

A single solution for companies running multiple competitions

Running multiple chance-based promotions over the coming year and want to speed up the permit process, whilst saving costs? The answer may be a blanket competition permit.

Benefits

A blanket permit allows you to set up a competition with no notice whatsoever, and works out to be a cheaper alternative to obtaining a number of individual permits.

Once you have a blanket competition permit you are able to use that permit number in each competition you run (provided that the competition complies with the requirements of that permit).

Rules of a blanket

A blanket competition permit runs for 12 months. The general rules of a blanket are:

  • The value of each prize must be $1,000 or less;
  • You must give away less than $100,000 over the life of the blanket;
  • You must give away less than $5,000 in each draw; and
  • You must keep records of each prize given away, the winners details and the promotion details.

States

To run competitions under a blanket you will need a permit from New South Wales and the Australian Capital Territory.

In NSW you can obtain either a Class B or a Class C blanket (different rules apply to each).

Conculsion

If you are running a number of smaller competitions, want flexibility in the competitions you run and see value in a blanket permit give us a call and we can obtain a blanket permit on your behalf.

Common errors to avoid when applying for a competition permit

The State gaming regulators review thousands of applications for competition permits each year. A significant amount of rework is required when errors are picked up by each State. In some cases you may be issued a permit in three of the four states and then need to lodge amendments in the first three, at additional expense.

Here are some of the most common errors:

1. Failing to include mechanisms for unclaimed prizes. Usually you will need to allow three months for prizes to be claimed. If they are not claimed, then conduct an unclaimed prize draw.

2. Not including dates and times for the competition open, close, draw and notification periods. It is important to note all of these dates and also to sick with your terms and conditions. There is always the chance that the lottery departments will actually attend your draw so you need to ensure that your entries are in order and that you conduct the competition draw on the time and at the place specified in your terms and conditions.

3. Not providing sufficient detail on the prizes to be awarded. For example, each component of the prize should be valued (based on RRP), if accommodation is a part of a prize then you should state the type of hotel or star rating plus the number of nights.

4. Excluding mandatory costs such as taxes on flights from a prize. You cannot require a winner to pay to take a prize. All mandatory costs need to be included in the competition prize.

If you have any questions on the above, send us an email to info@permitzgroup.com

Frequently asked questions about competitions and competition permits

Do I need competition permits?

Competition permits are usually required to conduct chance-based competitions. There can be significant penalties imposed on your organisation by the regulatory bodies if you fail to obtain competition permits when required.

A competition that is based on skill does not involve an element of chance in determining the winners. Chance based competitions are usually more difficult to set up but do attract more entries (as they are easier to enter). An example of a skill based competition is one which asks entrants to submit an answer in 25 words or less. Winners must be selected based on the criteria set out in the competition terms and conditions.

Is it difficult to set up a competition?

Unfortunately, it can be difficult to draft compliant terms and conditions and apply for competition permits in each state. Each state has different requirements under their respective gaming regulations. The reason is obviously to ensure that only legitimate competitions are run and that entry is free and all entrants are given a fair chance of winning.

We set out some of the requirements below. If you are setting up your own competition, we suggest you read the relevant regulations and guidelines produced by the State Gaming agencies. Some of the rules that State Gaming agencies apply are not published anywhere and you may only find out about them when your application for a permit is rejected.

What should I look out for?

If you are drafting your own terms and conditions be careful to fully set out how and when people can enter, what the prizes are and their value, how the winners will be determined and how you will notify the winners. You must ensure that you set out any conditions you want to impose in relation to how to enter, and in relation to the prizes themselves. It is important to be clear to avoid confusion and complaints.

You should be careful to consider how many times you want people to enter your competition. If you only want entrants to enter once, be sure to set this out in your terms and conditions. If you fail to limit the number of entries you may end up with some people entering hundreds or thousands of times! This could, or could not, be what you want. You should consider noting that use of ‘scripting software to enter is prohibited.’

Your main responsibility is to be fair and to abide by your terms and conditions. If you are going to be running a number of competitions over time, you should consider implementing policies and procedures to ensure that your company complies with the applicable regulations. Contact us to assist you in setting this up in compliance with the principles in Australian Standard AS 3806-2006.

What do I need to know when setting up a skill based competition?

While you do not need permits to conduct a skill-based competition you need to ensure that you comply with all other requirements such as those in the Privacy Act.

If your competition is open to NSW residents, you should review the NSW Department of Fair Trading’s site on Special Offers and Competitions. Requirements include that you supply the prizes that you offer and that you disclose special terms and conditions that must be met before someone can claim a prize.

What prize(s) should I give away?

The competition prize being given away will directly influence the number of entries you receive. The type of business or product you are promoting should help you determine which prize to giveaway. Giving away your own products or services as a prize can give you a good source of demographic data and potential future marketing contacts within entrants.

The type of people you want to enter will have a big impact on your choice of prize. Consider the age, gender, income and habits of entrants you want to target. Think about what is popular in that group of potential entrants at the time you are running your competition. Tastes and trends change over time so ensure you keep up to date with the latest.

Cash, Holidays, Electrical appliances are almost always sought after. Our own research has shown that the actual dollar amount of cash given away has less of an impact on the number of entries than anticipated. We have seen little difference in the number of entries received for a $10k prize pool as opposed to a $5k prize pool.

When are permits required for competitions?

You need permits for chance-based competitions where you pick winners at random. Permits are required when your competition is open to residents of NSW, ACT, and SA, VIC and WA (for promotions with a prize pool over $5K). There are substantial penalties for not complying with relevant state legislation.

Have a look at our YouTube clip on Facebook competitions and the different requirements at www.permitzgroup.com.au

Each state has its own requirements. Even states such as QLD that do not require permits have rules that you must comply with in running a trade promotion.

How long will it take to get permits?

Different states take different lengths of time to get permits back to you. At some stages SA and VIC can take three weeks to approve permits. Ultimately it depends on their workload at the time. In SA you can pay a premium fee to have your permit assessed within 5 business days.

It will typically take Permitz Group 2 days at most to draft compliant Conditions of Entry. Once you have reviewed the Conditions of Entry, we will then submit for permits the same day.

How much do the permits cost?

The cost depends on the total prize pool you are giving away. Send an email to info@permitzgroup.com for an obligation free quote.

Do I need competition permits for an unusual promotion?

 

Your competition may be a combination of skill or chance, may involve a prize that cannot be valued, or may determine the winner on the order in which they enter.

The general rule is that you will need competition permits if your promotion involves an element of chance. If your prize cannot be valued, you will still need to work out a value for your competition permit application.

The best advice is to check if you are unsure. You can either call each of the lottery agencies or call us and we will work out if you need competition permits.

Is a blanket permit right for my competition?

A blanket permit may be the answer for a company wishing to run a number of promotions over a period of time as distinct from a single trade promotion permit obtained from the various state regulators.

The two most significant benefits of having a blanket permit are: 1) they can be cheaper and 2) they allow for greater flexibility over that given by a single competition permit.

Flexibility is given as you do not need to apply for a single competition permit, specifying the dates, prizes and conditions of entry when you have a blanket. You can simply use the approved terms and make those adjustments. The permit number you have for the competition will remain the same. In NSW a ‘blanket’ competition permit will start with LTPM as opposed to LTPS.

There are a number of restrictions in running competitions under a blanket, i.e. a blanket competition permit will not work in all situations.

If you are looking at running a number of competitions over 12 months and:

  • a. Cap the value of each prize at $1,000 or less;
  • b. Give away less than $100,000 over the life of the blanket;
  • c. Give away less than $5,000 in each draw; and
  • d. Are able to keep records of each prize given away, the winners details and the promotion details.

Then a blanket permit may be the answer. Give us a call or drop us an email if you would like to learn more and discuss if a single competition permit or a blanket permit is the answer for you.

Competition permits in NSW

A competition permit is required from NSW for any chance-based competition, i.e. no matter the total value of all prizes in the competition. Thankfully, it is reasonably easy to obtain a competition permit in NSW.

NSW have many of the same requirements that are present in other states in relation to chance-based competitions. These include the requirement to hold an unclaimed prize draw if the initial winners cannot be contacted after 3 months and the requirement to hold trade promotion permits which need to be displayed on all advertising.

NSW are much quicker than any other state in issuing trade promotion permits and the fees are, generally, cheaper. The cost of a permit for a competition with a prize pool of under $10,000 is $80.32. The department are helpful with the process.

To obtain competition permits from NSW it is important to ensure that your competition complies with the various requirements. Permitz can assist in reviewing or drafting terms to ensure compliance and quick issue of a competition permit.

Votes, shares, and referrals- do I need a competition permit?

We are often asked if competition permits are required for a competition where the winners determined on the basis of the number of votes, shares or referrals.

Such competitions can be an effective way of spreading a message or growing a customer database in a viral manner. Commonly such a competition would require the original entrant to submit an entry which others then vote on or require the entrant to refer friends and colleagues. The winner would be the individual with the most number of likes, shares or votes.

When conducting a referral based competition it is important to ensure you are compliant with the Privacy Act and Spam Act. It is not okay to send third-parties marketing material when they have not consented to the receipt of such material.

When conducting a vote based competition it is important to ensure you consider means to limit the risk of individuals buying votes or submitting multiple votes in breach of the terms and conditions. Permtiz can assist you in understanding your options to limit this risk.

Such a competition may involve an element of chance which would result in a need for competition permits. An element of chance may be introduced if a draw is involved or if a limited number (determined at random) can participate.

Chance can be avoided if the winners are determined on the most number of likes, shares or votes and there is a tie-break mechanism that requires and is judged on the basis of skill. For example, if two or more entrants receive the same number of votes, to determine the ultimate winner the Promoter could ask the tied winners to submit an answer to a question and then judge the winner on the basis of their answer.

Blanket Competition Permits

A blanket competition permit can be a good alternative to applying for individual competition permits for each promotion you run.  A blanket competition permit can offer significant cost and time savings if your organisation runs a number of competitions each year.

If you are looking at running a number of competitions over 12 months and:

a. Cap the value of each prize at $1,000 or less;

b. Give away less than $100,000 over the life of the blanket;

c. Give away less than $5,000 in each draw; and

d. Are able to keep records of each prize given away, the winners details and the promotion details.

Then a blanket permit may be the answer.

You can obtain a blanket competition permit from New South Wales and the Australian Capital Territory. In NSW you can obtain either a Class B or a Class C blanket (different rules apply to each).

The two main benefits of having a blanket permit are that it can be cheaper to obtain a blanket than to obtain individual competition permits for each competition you run and that, once you have the blanket permit, you can set up a competition very quickly. Once you have a blanket competition permit you are able to use that permit number in each competition you run (provided that the competition complies with the requirements of that permit).

If you are running a number of smaller competitions, want flexibility in the competitions you run and see value in a blanket permit give us a call and we can obtain a permit on your behalf.

When do I need a competition permit?

We are often asked when a competition permit is actually required?

General considerations

Competition permits are typically required for chance-based competitions. Usually this is easy to determine. For example a competition which involves a draw when determining the winners will require a competition permit. A competition permit is not required for a game of skill where the winners are determined by a qualified judge. For example a competition that asks entrants to provide an answer in 25 words or less would not require a competition permit if the winners of that competition were judged on the basis of their answer.

Other types of competition are not so easy to classify. Some competitions involve both skill and chance in determining the winners. An example of a mixed game of skill and chance might be where entrants need to submit answers in 25-words-or-less which are judged by a qualified judge but then given a chance to win a major prize by just participating in the promotion. To determine the major prize winner a draw might take place. In such a situation the whole competition would need to be reviewed by the state gaming authorities. In such a situation it may be possible to split the promotion if the Promoter were looking to reduce the cost of permits.

Specific consideration

Another aspect to consider is whether the competition will be open and advertised nationally. Of the different states in Australia: New South Wales, Victoria, the Australian Capital Territory and South Australia are the only states that require you to apply for a competition permit. A competition permit will be granted in WA under the regulations by default provided that your competition complies with the permit conditions and that you submit a copy of your terms to the Department of Racing, Gaming and Liquor. You will need a competition permit from the Northern Territory if you don’t have a competition permit in another state or territory.

There are some exemptions that you may be able to take advantage of. For example in the Australian Capital Territory you will not need a competition permit if your promotion is centered on the grant of a refund of a purchase price (and provided you comply with the other aspects of the exemption).

You will also need to review whether you are exempt from the need for a competition permit based on the total you are giving away. You won’t need a competition permit from South Australia and Victoria if your total prize pool is under $5,000 (and your competition mechanic- for SA- is not instant win).

How do I obtain a competition permit

Once you have determined if you need a competition permit the next step is to apply. Each state has a different competition permit application process. It is important to ensure that your competition complies with the various requirements in each state. If your competition does not comply you are not likely to obtain a competition permit. Permitz can apply for competition permits on your behalf.

Once you have the competition permits you require you will need to ensure you include them in all advertising, along with the other mandatory information.

Please let us know if you have any questions on the above or would like us to review whether or not your competition needs a competition permit.