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When running a trade promotion in NSW, there are many different factors to take in account. There are different NSW competition permits and requirements, which we will discuss in this article, and there are also factors such as trade promotion mechanics and strategies to ensure you run a successful promotion.
NSW recently introduced significant changes to trade promotion regulations under the Community Gaming Regulations (NSW) 2020, which came into effect on 1 July 2020.
We have summarised the key changes below, and highlighted the significant requirements that have remained the same.
A permit that was issued prior to 1st July 2020 will be honoured up until it’s expiry date.
Normally, you would be required to submit a formal amendment application for any change to your trade promotion terms. However, NSW Fair Trading will no longer accept amendment applications to a permit issued before 1st July 2020.
If you choose to amend your terms, you will be required to apply for a new ‘authority’ instead and the new ‘authority’ number will replace the existing permit.
The idea of a NSW trade promotion ‘permit’ no longer exists, and has been replaced with a requirement for a NSW 'authority’.
There are three (3) authority options only. You have the option to apply for an authority which applies for a period of either: 1 year, 3 years or 5 years.
An online application form must be submitted to request an authority. The form is available at: https://onegov.nsw.gov.au/New/categories/promotion-lotteries-fundraising.
You no longer require a permit/authority to conduct a promotion with a prize pool of $10,000 or less.
If the prize pool for your promotion is $10,001 or more you will require a NSW ‘authority’ to cover the conduct of your promotion.
Authorities are time based, meaning that Promoters can conduct a number of different promotions under the same authority for its duration.
There is NO cap on the total value of prizes you may award under an authority.
The person or organisation conducting the trade promotion must have written consent from the business which benefits from the conduct of the trade promotion.
Terms and conditions do not need to be submitted with the application for an ‘authority’.
However, to run a promotion under a current authority, a copy of terms for competition along with the authority number must be provided to NSW Fair Trading at least 10 working days prior to the start date of the competition via the following online form: https://tponline.onegov.nsw.gov.au/ntp-form.
The terms and conditions for the promotion must be made available by displaying them on a website or at the place in which the promotion is conducted.
The fees applicable are outlined below, and depend on the authority duration selected (1, 3 or 5 years):
Application for authority
*Based on online submission. Fees are quoted inclusive of the VISA/Mastercard merchandise fee charged by NSW Fair Trading.
A register of authorities will be stored online and will be available to access by the public for free.
The database may include the name and address of the promoter, the authority number, date of issue and expiry of the authority, conditions subject to the authority, any enforcement actions taken by NSW Fair Trading against the promoter in relation to gaming activities.
An application to renew the authority can be made, and generally must be done so within 3 months of the expiry of the current authority. However, NSW Fair Trading has discretion to renew an authority after the 3 month period passes, if failure to renew was due to an oversight by the promoter or if it is just to do so.
Please note the department may deem it in the public interest to renew for a shorter period than you apply for.
If an authority expires after you submit a renewal application, the original authority will continue until a determination is made regarding the extension.
Once an authority is cancelled it cannot be renewed/restored. A new authority must be applied for in such an instance.
Formal amendment applications are no longer required for NSW trade promotions covered by an authority.
However, if there is a ‘substantial change’ to the conduct of the activity under an authority, the holder of the authority must:
Under the regulations, ‘substantial changes’ include (but are not limited to):
It is also important to note that ‘amendments’ can not be made to permits issued under the old scheme, and if changes are required, you will need to apply for an authority under the new regulations.
NSW Fair Trading has advised of the following current processing times for each of the following:
Please note that due to the new nature of the changes, it is unclear at this point regarding the form of approval for amendments and approvals of terms. We will update this article once we have further information. The above timings are again estimates only and may change depending on the number of applications received by NSW Fair Trading.
Terms and conditions are a very important part of any trade promotion. Plexus has all the information required for drafting terms and conditions, as well as a terms and conditions template for use in Australia.
Any terms and conditions for a trade promotion must contain the following information:
Other Standard Requirements
If an authority number is required, then it must be clearly displayed on the promotional advertising materials.
The legislative changes do not mandate when or the form in which winners must be notified.
The previous requirement was personally (e.g. phone, email, etc) within 2 days of the draw.
Winners are no longer required to be advertised.
Previously winners of any prize valued at $500 or more were required to be published.
There is no longer a requirement to obtain independent reports for electronic draw systems.
An independent scrutineer is required for activities in which an authority is required (competitions with prize pools over $10,000). This differs from the previous requirement, which specified a scrutineer is required for any draw in a promotion where the total prize pool for the draw was more than $10,000.
The period for conducting an unclaimed prize draw may now be specified in the rules of the gaming activity or, if no time is specified, at least 3 months after the prize winner was previously determined. This means that there is no longer a set rule on including a 3 month claim period, however given the 3 month ‘default’ requirement, it would be prudent to include a 3 month period, if possible.
Printing errors must not invalidate an otherwise valid prize claim. E.g. if you print more winning scratch cards then intended you must still award the respective winners.
Monetary prizes that exceed $5,000 must be paid by electronic fund transfer (EFT), if the winner requests, or in any other case as agreed between the prize winner and the person paying the prize.
This differs from the previous requirements, which stipulated monetary prizes over $2,000 must be paid by EFT if requested, or otherwise by crossed cheque.
Alcohol restrictions remain consistent with the previous regulations, with prizes prohibited from exceeding:
In addition, the following prizes are prohibited under the new regulations (vaping products are a new addition):
Prize substitution is permitted if the prize is not available due to unforeseeable circumstances. Prize substituted must be similar to the original prize AND of equal or greater value.
If the prize is valued at over $100,000 though, a substitute prize cannot be awarded, unless prior to time winners are determined, entrants are notified of the change and are provided with the opportunity to choose to stay in or opt out of the competition.
There is no longer a requirement to keep records for conducting trade promotion gaming activities.
However, maintaining records is recommended by the Department, as this will help properly manage activities.
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