Do You Run Contests or Giveaways on Your Blog? Are You Sure They’re Legal?

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Many of us run the occasional promotion on our blog in the form of giveaways or contests. Having had experience over a number of years of running competitions in jobs I’ve had, I was aware of a lot of the legislation that exists, however I had never really thought about it much in terms of my blog. I decided to look into it, naively thinking I could just do a little bit of research and then post the main rules on here for any other bloggers who may be interested. Turns out it’s far more complex than I had realised.

This post is going to be quite long, and frankly not very interesting for anyone who doesn’t run prize promotions on their blog, so if that’s you, you may as well stop reading now, I won’t be offended, see ya, wouldn’t wanna be ya!

For the rest of you (and I know I’m going to lose more of you along the way)…

Let’s Begin

As you can imagine there is different legislation in different countries, and in different states/territories/areas within countries. And even within those, there isn’t just one piece of legislation – depending on what type of prize promotion you are running (I’m going to use the term “prize promotion” to cover all types of contests and giveaways), you could need to refer to legislation about prize draws, giveaways/sweepstakes, competitions/contests, lotteries, promotion/advertising/marketing, gambling, gaming, data protection, equality etc. Plus there are many variances in terminology that can be confusing, and when you do read the legislation, you have to contend with all that Paragraph 6 Section 4(b) Schedule 7 type of malarkey.

I couldn’t possibly cover everything in this post (nor would you want me to), so instead I’m going to draw out some key points which you may want to think about (although PLEASE do note my disclaimer at the end).

The first question that sprung to my mind, and possibly yours is this – if you’re running an online prize promotion on your blog, and you are allowing entries from around the world, do you have to comply with the legislation of all countries? The short answer is yes (eek!). The long answer is yyyeeeesssss (eeeekkk!).

Let’s ignore that question for now (I’ll come back to it later), and answer some others…

Doesn’t all this legislation only apply to businesses/corporations?

No. A lot of it won’t be relevant to little ms/mr blogger, but much of it is, and you’d be wise to inform yourself of it.

Are there some general rules that apply in all countries?

What? You expect me to have read the legislation for ALL countries? Get real! I have however looked at the legislation for several countries, and what I can say is that there are some general rules that seem common to many.

Primarily, for the types of prize promotion we are talking about, there are three main categories:

  1. A free prize draw Also known as a giveaway, or a sweepstake. It is free to enter, and the winner/s are drawn at random. (in some countries, free prize draws are generally free of direct legislation, although you do of course still need to comply with common laws. In other countries free prize draws with no skill element required to enter are not allowed). Remember that if it’s random, it really must be random; a simple way is to attribute a number to each entrant and then use an online random number generator.
  2. A competition or contest These involve some skill or special knowledge to be demonstrated in the entry, and may or may not involve a cost, or purchase required, to enter. The winner/s are judged on merit of their entry, and not by random selection.
  3. A lottery This involves a payment to enter, and the winner/s are drawn randomly.

Be clear on those distinctions because mixing them could run you into trouble. If you require entrants to pay something, or buy something, in order to enter and then the winners are chosen randomly, you could be deemed to be running an illegal lottery or possibly a gambling operation depending on the nature. And if they are required to play a game of chance, this could be an illegal gaming operation, EVEN if payment is not involved (Whhaaattt?).

Almost everywhere, if you run a lottery, or any form of gambling, or gaming, you need a permit. Therefore if you are requiring people to pay something in order to enter, then there MUST be a skill/knowledge element to enter, and the winner MUST be judged on merit of their entry, and not randomly or by chance. And you need to have something in the case of a tie, that also isn’t random.

To add some more complication. When I spoke of “payment” to enter, in some countries, mainly the US, payment is classed as “consideration”, and other things can also count as consideration, such as time invested in making an entry, which can count has having paid to enter, and therefore to reiterate, there MUST be a skill/knowledge element involved, and the winner MUST be judged on merit of their entry. I’ll also throw in here another point, sometimes it’s ok to have a payment type entry, with a random drawing, as long as there is an alternative free entry route that is as easy, and as well publicised as the payment route entry (I’m a bit fuzzy on the details of this aspect). Rafflecopter entries presumably cover this well because whilst they may have some entry options that involve some “consideration” there are others that do not, so they’re covering all bases. I saw talk on one lawyer’s site which implied that even asking people to ‘Like’ or ‘Follow’ something could potentially be classed as consideration.

Are you following this? Good, let’s complicate it further…

What is meant by skill/knowledge?

In many countries, the skill/knowledge required to enter, mustn’t be so simple that the vast majority of people could do it, so it couldn’t just be a question that was say “What is 2+2?” You may be wondering where the line is drawn between what is too simple, and what is acceptable right? Well indeed, and there is no definitive answer, that would be for a court to decided if it got to that stage.

In the case of blog contests, we quite often see creative skill required, to draw something, or write something, or come up with an idea for something. These are skill contests, and thus winners must be awarded on merit and not by random drawing.

Got that? Here’s a bit more…

Does “free entry” mean completely free?

When we talk about “free entry”, the cost of a phone call, text message, internet usage cost, or postal stamp to enter would still be classed as free entry as long as they are at the standard rates; any premium rate calls, or special postal delivery costs etc would then be classed as paying to enter, unless there is also an equally valid free route.

Is it ok to ask people to buy something in order to enter?

When we talk about “Purchasing a product” in order to enter, this is fine as long as the cost of the product required to enter the contest isn’t more expensive than the product costs anyway. And in some cases, purchasing a product to enter can still count as free entry (I’m not going to explain this one further, as it’s another area I’m a bit fuzzy on).

If I’m running a skill based contest on my blog, is it ok for me to be the one who judges it?

This one is a bit tricky (you know, like most of the rest of it). The UK legislation says that where the judging of results could be subjective (i.e. it’s not something with a right or wrong answer) you must always have an independent judge, you can be a judge too as part of a panel, but there must be at least one independent person. I found this in the legislation of a couple of other countries too, but not all those I looked at; do check that one out yourself (I’m not doing EVERYTHING for you). Either way, you must state clearly what the judging criteria is.

Are there restrictions on what you can give away as prizes?

Yes, in many countries you need a permit if the value of your prize is over a certain amount (generally much higher than would apply to most of us bloggers). Also, there are prize restrictions on items that are restricted (funnily enough), such as alcohol.

Do I have to list the terms and conditions of the contest, and if so, what must be included?

Yes, listing the terms and conditions is as much to protect you as anything else. There are lots of examples online of what should, or could, be included in the Ts and Cs, so do an online search for that and find something suitable. One point to keep in mind, when you state the closing date/time of a contest, remember to take account of time differences if it’s open to residents outside of your time zone, and specify which time zone your closing time refers to.

Are you nearly finished here Vanessa because I’m getting soooo bored?

I sure am. As well as reading my disclaimer below, remember that my notes above are a broad overview of SOME of the rules that MAY be applicable in your country or area. My mind keeps going back though to my first question, about whether an online contest open to everyone must comply with the legislation of every country. Because if it’s true that it must, then we’re kind of screwed….except, I saw on one law site where they suggested including the words “Void where prohibited” in the rules/Ts and Cs, which then puts the onus on entrants to find out whether they are eligible to enter from their country or not. Although of course if you do that, then presumably you’d still need to check out the legislation yourself for the country that the winner comes from, to be sure they are eligible before you give them the prize? But maybe that’s the only way around it, and it may be the way I go from now on. Did I mention how complex this all is?

Also worth noting, Facebook and Twitter have their own rules if you run prize promotions on there that you should seek out and adhere to.

For any of you that have stayed with me to the end of this post, congratulations, I would give you a prize except I’m not sure if I’m allowed…

Were you aware of all of the rules/some of the rules? Do you let it affect how you run prize promotions or do you just do it the way you want to and keep your fingers crossed that it won’t ever be an issue?

DISCLAIMER: The information contained in this post is correct to the best of my knowledge, however, I am not a lawyer, nor do I claim to be any kind of expert on the law. Nothing in this post should be taken as legal advice. Always do your own research and/or get legal advice before running any kind of promotional activity on your site.

These are some of the websites that I looked at when researching this post:
cap.org.uk
competitionagency.com
contests.about.com
dca.ca.gov
definitions.uslegal.com
dlapiper.com
dmaresponsibility.org
gamblingcommission.gov.uk
gambling-law-us.com
jonesday.com
money.howstuffworks.com
out-law.com
quora.com
sarafhawkins.com
targetmarketingmag.com
thompsoncoburn.com

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79 responses to “Do You Run Contests or Giveaways on Your Blog? Are You Sure They’re Legal?

  1. Reblogged this on Chris The Story Reading Ape's Blog and commented:
    Authors – Some things you need to know…

    Liked by 1 person

  2. I’ve attempted to explain these things before to a general round of eye-rolling and “don’t care.” It’s one of the reasons I rarely do giveaways (unless it’s through another entity with a big legal department – e.g.. Amazon or Goodreads) and prefer, instead, to run the occasional contest where the prize is of nominal value and the emphasis is on FUN. I’m fuzzy on where a required purchase might be considered a “free entry” – I was not aware of any case where that’s true (unless there’s an alternative, truly FREE method). Adding an element of skill is not that hard; finding an independent judge isn’t, either. And those seem less risky than running afoul of sweepstakes/lottery rules, because if you confuse the two, you are, as you pointed out, running a gambling operation. I do think “Void where prohibited” is a critical thing for your TOS – individual bloggers cannot reasonably be expected to know the law worldwide, and it seems unkind to simply say “Open only to residents of my state” (even that gets complicated). That puts entrants on notice that it MAY be prohibited to them and that they should check. I’d also suggest making the TOS as non-boilerplate as possible, so something triggers the brain to pay attention. (We agree to a lot of crap every day on the Internet that we don’t read. The main protection there is that things like “I agree to let you murder me in my sleep” aren’t really legal or enforceable under contract law…)

    Liked by 1 person

    • Hi Holly! Thanks for stopping by to give your input. Yes, I think a lot of people are either oblivious to this sort of legislation, or as you say they just don’t care, but at least they can’t say they didn’t know if we’ve spoken about it! I think people assume that they would never get caught or wouldn’t get into trouble, but only takes one disgruntled contest loser who decides to complain to the right authorities to potentially cause a problem for a blogger. I’m sure it’s very rare for that to happen, but surely it’s better to make a little bit of effort to ensure we comply rather than take the risk!

      I’m certainly going to take more care in future to make sure I’m complying properly.

      Liked by 1 person

  3. Yikes!
    Can we just say “I have x copies of my book, free to the first x people who respond.”?

    I got a paralegal degree back in 2010 and it simply made me paranoid! 😀

    Liked by 1 person

  4. So maybe I should never have another drawing for a Facebook event like the one I just finished! I just put the names of all who attend on slips of paper, put them in a box, and draw one out. Next time I think I’ll just post up some Smashword coupons for free copies and let anyone take them who wants them! Surely that’s legal! But I think it’s more fun if you think you’ve won something. Life is a mess sometimes.

    Liked by 1 person

  5. Thanks Vanessa and despite your protestations it was neither boring nor too long.. as authors become more competitive with their marketing, especially on their blog, they need to know this stuff.. will reblog.

    Like

  6. Reblogged this on Smorgasbord – Variety is the spice of life and commented:
    Whilst most of us who give away books or perhaps Amazon gift certicates via our blogs, it is important to remember that you have a world-wide audience and that somewhere amongst all those countries are laws and regulations about giveaways and competitions. Well worth reading Vanessa’s well researched post.

    Liked by 1 person

  7. This is a great post! I have shied away from doing this on my blog, because of the concern of compliance. I also didn’t want to spend hours and hours coming up with rock solid rules for something that is supposed to be fun and simple. Thanks for putting this together and I am glad I haven’t done this 😉 Love your last line…lol!

    Liked by 1 person

  8. Well, this is an eye-opener. Thanks for the post and I’ll check out the links.

    Liked by 1 person

  9. International commerce is such a new thing, there is plenty we don’t know. I’m sure there are countries where whatever we write is considered subversive too. Distributing it could land someone in hot water.

    Like

    • Yes I’m sure, I think more and more we’re going to see certain bits of legislation aligning between a lot of countries to enable smoother working between them. I found that with this, some of the legislation was so similar to each other in some countries, there’s no way it’s coincidence.

      Liked by 1 person

  10. Holy Moly. Have you been researching this this whole time? That’s quite a bit of work and well laid out. Sorry. I DID yawn near the end–nothing to do with your presentation. That’s just me. 😦
    Shared on Google+ and FB.

    Liked by 1 person

  11. Wow, great information here, Vanessa. Thank you. I knew Facebook had rules, but I didn’t realize small blog giveaways might be a problem. I used to do them, but I don’t anymore because they don’t seem to generate much interest. From now on I’ll stick to Goodreads giveaways, and I might try an Amazon one too. As you say, they have the big entity running them, not me alone.

    Liked by 2 people

    • Yes, you used to do some awesome giveaways, I was the lucky recipient of a box of books from you! I’m glad I hadn’t written this post prior to that 😉 As you know, I do like to do a little giveaway or contest on here every now and again, but they really are just for fun, it’s not like I have a book to promote or anything – as you say they don’t seem to generate any more interest than general posts, but I just like doing them! I’m going to be more careful from now on though to make sure they comply with what needs to be complied with.

      Liked by 1 person

  12. Jeebus Christmas, what hit me?! Of course I wasn’t aware of all this nonsense. Who is?! I almost lost it at Ts and Cs but I hung in there. Too bad a prize isn’t awarded for finishing. I kind of expected it.

    Liked by 2 people

  13. Oh, oh–does this mean the end of Mike’s doodle giveaways?

    Like

  14. I read it until the end! Yeah me! I won! Hm, opps, didn’t win anything but confusing knowledge. I haven’t held any contests or anything like that…think I’ll stay away from them and let Goodreads and Amazon do the legal stuff. It’s a lot of stuff to learn! One wouldn’t think a simple blogger would have to know all this…but I think we do. Thanks Vanessa!

    Liked by 1 person

  15. Wonderful information here, Vanessa (and I DID read till the end) 😉 It must have taken a lot of time to write this and it’s very much appreciated. Even in Australia the different states carry different legislation on this, so on a world-wide scale it becomes very complex indeed 😀

    Liked by 1 person

    • Yes, Australia is one of the countries I looked at, there are some things that seem to be the same in most countries and then some seemingly random things are completely different in one country, or one state somewhere, maybe as a result of a particular court case or something I guess. Thanks for stopping by to read and comment!

      Liked by 1 person

  16. Well if that doesn’t convince one never to think about a give away I’m Tinkerbell. Wowza thanks and totally not aware.

    Liked by 2 people

  17. Thanks for that, and yes, I read to the end (and thanks to TSRA for reblogging it!).

    I think that most of us who run giveaways – especially on giveaway hops where the hop ‘owner’ sets out a few rules, like it must be a real prize, not you get to name a character – have got things set up to keep the right side of the broad spectrum of rules. Your reminder of the difference between draw, competition and lottery was useful. Always good to remember things one once knew! – and my T&Cs generally say ‘only valid in areas where this type of giveaway is legal’ which may not be the proper terminology.
    Basically, use a random number generator or rafflecopter, offer a free entry, (along with other easy options) and make the prize something quite small.
    And giving away x copies to the first x people to comment is a free promotion, not a lottery, draw or competition!
    Keep up the good work and thanks for doing the research 🙂

    Liked by 2 people

    • Thanks for stopping by and reading to the end! Sounds like you’re on top of it all, I think it could be very easy though for those who aren’t really aware of the rules to break them – chances are they mostly get away with it, but that’s not a reason to keep doing it once aware! It seems the “Only valid where…” type comment is a must, I’ve never done that before, but I will now, I guess the terminology of that statement doesn’t matter too much as long as it’s clear what is meant.

      Liked by 1 person

  18. Wow! I had no idea how complicated it could be. Thanks for the info.

    Liked by 1 person

  19. Reblogged this on BOOK CHAT and commented:
    Authors and bloggers, if you do giveaways, this is a must read.

    Liked by 1 person

  20. Thanks for sharing this information. It does indeed appear to be very complicated.

    Liked by 1 person

  21. Thanks for sharing this information. It does indeed appear to be very complex. I think I’ll have to bow out of running contests and giveaways. I’m pleased I haven’t already.

    Liked by 1 person

  22. *Yawn*
    *Yaaaaawwwwwwn*
    “Y-i-k-e-s!”

    I will never, ever, ever, ever, ever run a contest. Thank you for immunizing me against the thought.

    Cheers!
    Jilanne

    Like

    • Haha, oh dear Jilanne! I didn’t really want to put people completely off doing one ever, although that is what I seem to have done with a few people! The rules sound complicated but of course a lot of them aren’t relevant depending on what you’re running. I’m sure it can’t be that hard to make sure it’s legal on all counts…can it?

      Liked by 1 person

  23. Dang! Why does there always have to be a party pooper in the crowd? Pf course, not you…those dang legislators.

    Rules, rules rules…why can’t we just have fun? Remember the days when we were free to do just about anything?

    Like

  24. Reblogged this on D.Katie Powell Art and commented:
    I had to post this. I know so many artists who do giveaways. EEEK! Don’t want to break gaming laws!

    Liked by 1 person

  25. Wow. This is a thorough, well-researched and comprehensive treatment of the subject. I can tell that because it’s really, REALLY long, not because I read it all. The lesson I gleaned from skimming, though, is no more contests. Ever.

    Liked by 1 person

  26. Why do these nit picking laws have to get in the way of some blogging fun? I’ve always enjoyed your fun contests, as well as other bloggers’, and Mike’s doodle give aways of course. ARGH. I wish we could ignore it all-but in this day and age- we can’t. Thank you for putting so much time and effort into educating us.

    Liked by 1 person

  27. I’ve only done a couple of giveaways on my blog, but funny thing is, I never seemed to get the same number of people commenting on those posts as I do my other posts, so I stopped doing them. I figured somewhere down the road I’d go back to it, but after reading your post I’m not so sure!

    Thanks for the great info. That must have taken you a lot of time to put together.

    Like

    • Yes, giveaways are a funny thing aren’t they, they don’t really seem to attract more visitors or anything. I like doing them for fun, not as a way to try and get more followers or anything. I still plan to do an occasional one, but I’m make sure I’m legally compliant from now on.

      Like

  28. I think I’m going to have “void where prohibited” tattooed on my forehead. 😀

    Liked by 1 person

  29. Thanks for this (actually pretty in-depth) post, Vanessa! Smaller bloggers like me probably don’t consider all of the legal ramifications of even just the proper terminology, so this was a good eye-opener.

    I’ve never done a giveaway or competition of any sort on my own site…but I do remember being a disgruntled contestant when I submitted to one writing contest where the blogger’s obvious BFF won the main prize. I never took anyone to task for it (save for dropping my support of that blog), but I also never trusted online write-in contests again! LOL!

    Thanks again for your hard work pulling this together. It must have been a lot to sift through! While the Internet creates smaller distances between people, residents are still bound by their own country’s or state’s laws, as well as the Internet ones.

    Like

    • Yes, it’s useful to know this I think, and probably not too hard to comply once you’ve got your head around it all.

      What you said about that writing contest is a good reason for complying with the law when we run contests, you didn’t do anything about it, but if someone had launched an official complaint (with whoever you complain to about these things!), potentially that blogger could have been taken to task in some way.

      Yes it was a lot to sift through and I considered giving up at one point, but then when I realised I couldn’t cover EVERYTHING, and I should just pick out a few relevant common things, it felt less onerous.

      Liked by 1 person

  30. I’ve never run a contest … have had the occasion thought, but never carried through with it … and to be honest, haven’t encountered that many.

    Liked by 1 person

  31. Reblogged this on TheKingsKidChronicles and commented:
    Oh, the hazards of running the gauntlet between promoting your own work, the work of others, and knowing the legalities. Re-blogged from vanessa-chapman.com

    Liked by 1 person

  32. I had to look into this a while back. Thanks for putting a post together about it! Giveaways seem to be the easiest thing to run. Contests are rather complicated. I try to do stuff on Rafflecopter because they provide all the necessary text for giveaways.

    Liked by 1 person

  33. Wow! What a minefield. I think I’ll stick to my free book that I give to everyone, and Goodreads giveaways. Thanks for sharing! 🙂

    Liked by 1 person

  34. I had NO idea about any of this! It’s one of those things that you take for granted and assume things are all okay. Damn, i won a book on a giveaway and didn’t declare it to HMRC. I’m going on the run …

    Like

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