What are the conditions and requirements for competition draws?
Know all the requirements for drawing a winner of your trade promotion competition.Read the article
It is important to outline in your competition terms and conditions who entry is open to. This is to avoid issues of people entering who you didn’t intend to enter and to make it clear to potential entrants whether or not they are entitled to enter. If you don’t make this clear you could find yourself awarding a prize to a person to an unintended recipient; or you may receive queries from the public with questions on eligibility which could have been avoided.
The typical considerations for considering who can enter are outlined below:
Typically, you will outline whether the entrant must be an Australian or New Zealand resident or resident of any specific State/Territory. You may also want to require the entrant to be a permanent resident or only a person with a VISA.
If you are conducting a game of chance promotion, the place of residence of an entrant may also impact where you will need to obtain permits. E.g. if you are opening entry to QLD residents only, no permit will be required. If you open to NSW residents, a NSW permit is required.
It is important to outline the winner’s place of residence, as if the winner is located in an area unintended or overseas, you may need to organise delivery of the prize to that location which could be expensive. If a travel prize, this could also be a financial concern in terms of providing flights from their place of residence to the prize destination.
Most Common: Australian residents
For any promotion age is always a consideration.
You need to consider whether the entity who enters is an individual or a business (or both). In some instances, it will be necessary to specify who on behalf of a business can enter (e.g. an authorised representative of the business, owner or manager, etc) and include any age/residency requirements for that individual.
For a business, you need to also consider whether they have to be a certain type of business e.g. a business with an account with the promoter or who purchases XXX products from the promoter.
If an entrant is a customer of the promoter, you may not want to award the prize to them if they have outstanding debts owed at the time the prize is awarded. In such a case, we would recommend including the following clause (or similar): The entrant must be within the Promoter’s trading terms throughout the promotional period and must not have overdue monies owing to be eligible to win a prize.
If you are opening entry to employees of the promoter or a particular business, you must be quite specific as to which employees may enter. If this is a big company, and entry is restrictions to members of one particular office or department or only a certain type of employee (e.g. sales staff), this needs to be included in your terms.
Where you award a prize, fringe benefit tax may be required to be paid by the winner’s employer. Therefore if you are asking employees of a third party company to enter, ensure you first obtain permission from the third party company owner and flag to them they may be liable for fringe benefit tax (or let them know you will cover this tax, if it applies).
If the entrant must comply with certain other criteria, you should ensure this is clearly specified in the terms and conditions. E.g. if they must be a member of an organisation/website/Facebook page. If this is simply a requirement of entry, and not a pre-requisite as an entrant, this should be referenced in the how to enter instructions instead.
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