Online competitions are legal in the UK if they are not classed as illegal lotteries, meaning they must either be free to enter or require a significant level of skill, knowledge, or judgment. Paid-entry competitions based purely on chance require a Gambling Commission license. Free draws and skill-based contests typically do not require a license.
Key Legal Requirements (UK):
Skill, Knowledge, or Judgement: To avoid being a lottery, competitions must require a level of skill that discourages or prevents a significant proportion of people from entering or winning.
Free Entry Routes: If a competition has a paid entry route, a free entry route (e.g., postal) must be available, which is no less convenient or more expensive than the paid route.
No Increased Cost: Products bought to enter a competition cannot have their price increased to reflect the cost of entry.
CAP Code Compliance: Competitions must follow the UK Code of Non-Broadcast Advertising and Direct & Promotional Marketing (CAP Code), ensuring clear terms and conditions and transparency on prize availability.
What Constitutes a Lottery? If a competition requires payment to enter (or, according to HCR Law, an excessive price to purchase a product) and is based solely on chance, it is likely an unregulated, illegal lottery.
What is a Free Draw? A free draw is any method of communication charged at the normal rate (e.g., post), allowing entrants to participate for free.
For large-scale, paid-entry raffles, a license is required, often restricted to non-commercial, charitable purposes.
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