Businesses often run trade promotions as a way of generating sales and interest in their products.  However, you need to know what permits (if any) you will need before running a trade promotion.  Each state or territory has different requirements for trade promotions. This article sets out each state or territory’s permit requirements for trade promotions 

Types of Trade Promotions

There are two types of trade promotions. They are a:

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

You need to know if you are running a game of skill or chance as that will determine if you need a permit. 

Game of Chance

A game of chance:

  • gives all entrants an equal chance of winning;
  • does not take into account any skill when determining winners. 

For example, you hold a barrel draw to determine winners for those who enter your trade promotion. 

Game of Skill

A game of skill:

  • allows entrants to perform skill-based activities to enter the trade promotion;
  • does not involve chance; and
  • chooses the winner against set criteria.

For example, entrants must write 300 words about their ideal holiday destination and trip. A judge will determine the winner based on the creativity, skill or originality of response.

When Do You Need A Permit?

You do not need a permit for a game of skill. However, you still need to comply with any state or territory laws or regulations that deal with trade promotions generally.

However, you may need a permit for a game of chance depending on where your business is located.

The majority of states and territories do not require a permit. However, in the states and territories that do require permits, the requirements can vary. If you are running a trade promotion across Australia, you have to comply with each state or territory’s requirements for permits. Otherwise, you may risk having your lottery shut down in other states or territories despite complying with the rules of your local place of residence.

Trade Promotion Permit Requirements

Location Permit Required? Regulatory Body
New South Wales (NSW) Yes, if the lottery promotes a trade or business.  

 

Apply for your permit at NSW Fair Trading

 

Victoria No. The Victorian Commission for Gambling and Liquor regulates lotteries
South Australia (SA)

 

Yes, if the lottery is a “major trade lottery” where the total prize pool value is greater than $5,000. 

 

Apply for your permit at Consumer and Business Services
Western Australia (WA) No. The Department of Racing, Gaming and Liquor regulates lotteries. 
Queensland No.

 

Business Queensland regulates lotteries.

 

Tasmania  No.

 

The Department of Treasury and Finance regulates lotteries. 

 

Northern Territory (NT)

 

Yes, if you are running a “major trade lottery” where the total prize pool value is greater than $5,000.  

You do not need a permit in the NT if you hold a permit in another state or territory.

 

Apply for your permit at  Licensing Northern Territory.
Australian Capital Territory (ACT)

 

Yes, but exceptions apply. These type of trade promotions do not need permits where:

  • the total prize pool does not exceed $3,000;
  • it is a private lottery not advertised publicly, with participation restricted to members of the same association or employees of the same employer; and
  • the prizes or rewards involve rebates, discounts, allowances or refunds that are also available to customers who do not enter the promotion.  

However, you need a permit if the promotion involves a lottery run on a website and:

  • the website is hosted in the ACT; or
  • the website is not hosted in the ACT but the promotion is advertised in the ACT as well as on the website. 
Apply for your permit at the ACT Gambling and Racing Commission

Key Takeaways

Trade promotions are a great way for companies to promote new products and raise awareness of the company’s goods or services. You do not need a permit for trade promotions that involve games of skill.

However, NSW, ACT and SA require permits for games of chance, although their requirements vary. If you are in the NT, you will need a permit for games of chance unless you have obtained one from other states or territories.

Regardless of where you are based, you will need to comply with any additional laws or regulations around lotteries. If you have any questions, get in touch with LegalVision’s competition lawyers on 1300 544 755 or fill out the form on this page.

About LegalVision: LegalVision is a tech-driven, full-service commercial law firm that uses technology to deliver a faster, better quality and more cost-effective client experience.
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