Winner Winner Chicken Dinner – Online Competitions in Australia
When it comes to online competitions, many Australians do not know the rules behind setting them up. Many businesses and online personalities use online competitions as a means for generating traffic, followers and sales. So what should you consider when setting up an online competition?
What are the laws generally in Australia around running online competitions?
In Australia, if you are doing a game of skill e.g. photo judging an Instagram contest of that nature, or an ‘explain in 25 words or less’, you do not need a permit to run those competitions. This is the case for all platforms within Australia.
For games of chance, e.g. lottery or random prize draw, you do need a permit
For a prize less than $500 you need a permit in NSW and ACT, if it between $500 and $5,000 you need a permit in SA, NSW and ACT. If it more than 5,000 you need a permit in SA, NSW, ACT, NT. You do not need a permit to conduct these competitions in VIC.
The cost of permits range between $60 – $200, but sometimes prizes over $1,000 will have a more expensive permit. This, however, varies depending on what platform it is being conducted on.
What are the most common types of online competitions?
There are various types of online competitions. From commenting on posts, subscribing to channels, following profiles, entering raffles, among many other forms of online competitions. These online competitions typically involve:
- Free items from companies
How have online and SMS competitions evolved compared to 5 or 10 years ago?
There is a growing competition culture on social media through platforms such as Facebook, Twitter, Instagram and through email. SMS is also used but not as prominently nowadays, as it is mostly used for verification of information and accounts while applying onto online platforms. These platforms provide a competitive advantage for creators to assess and monitor their reach on a digital level and can reach markets that were not accessible beforehand. The use of online competitions has significantly increased in the last ten years and shows no signs of slowing down, rather, it continues to evolve and change daily.
Have the laws kept pace with these changes?
Yes, although subtle, the guidelines provided within the promotions pages within social media websites have altered and changed to benefit not only the competition creator and the website, but have also changed to accommodate the contestant.
- This includes the laws around permits,
- what can be used as a prize,
- who can apply,
- constant adaptations of terms and conditions depending on the nature of the prize and the participants submitting their work
- how many times someone can apply either through message or through multiple accounts
- Platforms like Facebook have removed themselves from potential liability so it is advised that further investigation of the responsibilities of what the platform, the creator and applicant must be identified and communicated.
It is also advised that before perusing any further action, legal advice is recommended.
What are the rules around running competitions on Facebook, Twitter and Instagram?
- If you use Instagram to communicate or administer a promotion (example: a contest or sweepstakes), you are responsible for the lawful operation of that promotion, including:
- The official rules;
- Offer terms and eligibility requirements (example: age and residency restrictions); and
- Compliance with applicable rules and regulations governing the promotion and all prizes offered (example: registration and obtaining necessary regulatory approvals)
- You must not inaccurately tag content or encourage users to inaccurately tag content (example: don’t encourage people to tag themselves in photos if they aren’t in the photo).
- Promotions on Instagram must include the following:
- A complete release of Instagram by each entrant or participant.
- Acknowledgement that the promotion is in no way sponsored, endorsed or administered by, or associated with, Instagram.
- We will not assist you in the administration of your promotion and cannot advise you on whether consent is required for use of user content or on how to obtain any necessary consent.
- You agree that if you use our service to administer your promotion, you do so at your own risk.
Business, organisations and social media personalities have hosted contests on their twitter profiles. Twitter may offer prizes for tweeting an update, following accounts, or for posting updates with a specific hashtag. The twitter guidelines are used to ensure that the contest created on the platform does not violate rules and guidelines already existing on Twitter.
This includes the
- Discouraging the creation of multiple accounts
- Discouraging posting the same tweet repeatedly (spam)
- Asking participants to mention you in their updates so you can see all entries (so all candidates who have applied can be identified and not lost in the cyberspace)
- Using topics relevant to the contest
- Must follow Twitter rules (to be safe make sure to review the Twitter rules and business.witter.com provided on the Twitter website to gain a more thorough understanding)
- Must apply with all applicable law and regulations. This is the responsibility of the individual conducting the online competitions and seeking legal advice is recommended.
- Cannot run a contest on Facebook, you can only run it independently and then further promote it on the platform.
- Don’t install the contest as an app
- Don’t ask people to like or comment to win
What are the rules surrounding what prizes can be offered?
Depending on what state you are in, what the prize is and what platform you choose to submit the online competitions on, the rules surrounding the prizes and what can be offered changes. This includes permits, as for a prize less than $500 you need a permit in NSW and ACT, if it between $500 and $5,000 you need a permit in SA NSW and ACT. If it more than 5,000 you need a permit in SA NSW ACT NT. You do not need a permit to conduct these competitions in VIC.
Also, some platforms like Facebook, do not allow the competition to be made directly on the platform but instead created independently and then promoted via the service.
- Must be of an incentivised nature
- Must be relevant to what the competition is asking of its participants
- Must appeal to its target audience
- Best not to hold prizes that may alter the living environments or current living situation of the participants e.g. full home sound system. Could be used as a prize but must be relevant and marketed towards its favoured audience
Make sure to read through the terms and conditions provided on your desired platform before proceeding with using that form of social media to hold your competition.
How can consumers understand the terms and conditions of what they are signing up to? What do responsible terms and conditions include?
The terms and conditions would define the responsibilities of the contest holder as well as highlight the expectations of the runners-up/ winners of the competition. This would include the steps one takes to apply into the contest, as well as the instructions after if successful, consent applications and information which will allow applicants personal details to be used and further accessed by the company/ competition holder.
What happens if one of the contestants cheats? How can this be prevented?
On social media platforms like Twitter and Instagram, people can sometimes create multiple accounts, spam message the competition pages and ask friends and family to partake in the competition.
To prevent cheating you can monitor your contestants by:
- Scanning comments
- Looking at photos and messages that have been submitted
- Check entry data basis for duplicate entries e.g. dedupe programs which are already installed in some platforms
- Some online competition apps scan entries for anomalies
What are the privacy considerations of entering competitions?
If you are submitting a photograph for online competitions, you may be signing your moral rights to the owner of that competition. This means that even if you do not win the competition the property submitted may be used by the individual conducting the contest.
Through the application of submission personal details could be obtained, used and sent out to other third parties where your information would be beneficial for the purposes of advertising and marketing.
How can consumers avoid scams and spam?
- Consumers must be responsible for reading and understanding full terms and conditions
- Understand what the competition is asking and what the conditions may hold
- Check to see if you are signing into further subscriptions and marketing materials, not only a competition
- Know what the prizes are
- Double check for any conditions of the prize (if you must take your holiday between certain dates, or if there are limits to when a prize can be claimed)
- Look for a permit number, that would indicate if it is a chance based competition
- Make sure you know how your entry will be used if you enter the competition, know how your submission will be used.
- Try and opt out in receiving marketing material if possible
For more information relating to online competitions or if you wish to run one yourself, contact Sharon Givoni Consulting. We also offer a free 15 minute consultation so book an appointment with us below now.
This article is not to be relied upon as a substitute for legal advice and the laws may change from time to time.
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Sharon Givoni Consulting