Prize promotion and competitions are an increasingly common way for brands to reach customers and engage with followers. The internet has an overwhelming impact on our lives and third party social media platforms like Facebook, YouTube, Twitter and Instagram are leading the way for driving brand engagement. There are plenty of ways to engage with customers and build out your brand affordably but the challenge that many online businesses face is doing so legally. If you’re just starting out on your own, our experts have put together everything you need to know about giveaway laws Europe to ensure all of your giveaways are both success and legal.
Sweepstakes laws by country: Not all are created equally
While this article and site focus on the legal issues of online giveaways as it relates to English law, it is also important to consider the issue of sweepstakes laws by country. When it comes down to it, international giveaways are far more productive and provide a much-needed audience that extends beyond the UK, but navigating laws that relate to each individual country is equally as important as knowing your way around UK laws.
It is important to accurately do your research about the particular country in which you hold your contest or giveaway as the degree they vary can be significant.
For example, in the United States, lottery or prize contest earnings of over $600 MUST be reported to the IRS (Internal Revenue System) and taxed. In the United Kingdom, lottery winnings of ANY size are NOT taxable.
Learning and correctly implementing the laws of your own treaty will give your giveaway the attention you really want.
UK sweepstakes law
Because we are focusing on the UK, let’s take a detailed look at UK sweepstakes law.
Promotions in the UK must comply with the UK Code of Non-Broadcast Advertising, Sales Promotion and Direct Marketing (or CAP code). This code applies to social media and a brand’s websites to ensure promotions are operated legally, truthfully and fairly.
CAP requirements include making sure all conditions are made clear to consumers, including not putting rules or information hidden where few will read the fine print. CAP also mandates avoiding unnecessary purchases and disappointment, making contests fair and honest and choosing winners at random, when necessary.
In short, CAP is in place to promote and ensure fairness.
Date and Privacy:
Giveaways, by nature, operate as an information collection system, with the host and promoters gathering information about applicants into the event. In this way, they are an extremely powerful marketing tool, but they also fall under certain jurisdiction for keeping that information secure and private.
The 1998 Data Protection Act controls how the information you receive from applicants is managed and secured. Essentially, promoters must use personal data fairly and never sell that information to a third party. Furthermore, starting from 2018, in all EU you also have to follow GDPR regulation on data protection and privacy. The promotion should be structured so that it is clear that applicants consent to use and collection of their data.
Social media has welcomed any artist to promote their work over the internet. Whether a song, photograph, drawing or words (think captions and commentary), that content and information must never be taken from the owner and used as unique intellectual property. It is important to protect the rights and the property of all of your applicants.
These are not all of the rules governing giveaway laws in the UK and certainly not all giveaway laws Europe - but it’s a start! Keep reading.
International Sweepstakes Laws
If you are a European, hosting a giveaway across multiple countries may seem like a no-brainer! Why not expand your audience abroad?! Before you cross borders, it is important that you learn the international sweepstakes laws and guidelines for online giveaways for a fully legal event.
For example, some countries require that you state the guidelines or rules and conditions in a local language.
Other countries may require a certain license for hosting events of a certain size, independent of the fact that an online giveaway - by default - can be accessed from any country.
However complicated this may sound, it’s actually quite simple in practice: When hosting worldwide sweepstakes, you may choose to govern your giveaway by a single jurisdiction, from UK for instance. Putting in place one country’s guidelines and rules is the easiest and most effective way to maintain legal control and effectiveness of your sweepstakes.
On that note, it is important to stay in compliance with the social media platform which you are hosting your event on. If proper guidelines for Instagram, Facebook, YouTube etc are not met, your sweepstakes could be flagged and later removed from that platform.
Navigating giveaways rules
There are tons of giveaway rules that may seem confusing or unnecessary so let’s break it down into an easier-to-understand summary.
As a whole, laws governing giveaways, sweepstakes and other contests are in place to ensure fairness and control. Without basic laws, there would likely be discrimination, winners that aren’t chosen randomly and other unfair practices occurring.
The general rule of thumb for legal online giveaways is to always clearly and accurately communicate giveaway rules and guidelines to participants. If there is something left unsaid, put it in the guidelines and fine-print just in case!
Always treat participants fairly and equally and choose random winners. Never discriminate and never give participants an unfair advantage.
When announcing your event, make sure to do so publicly and the way you promised your participants you would; if you say you will announce the winner on social media at 5pm on February 1st, do not announce the winner via email on 6pm of February 2nd.
Finally, whether it be giveaways laws Europe or elsewhere in the world, always follow the rules of the platform you’re promoting your event on. Again, use your best judgement and common sense to guide you and none of these rules will be difficult to follow! With this summary and breakdown of giveaway guidelines, we hope your giveaway in the UK is a success. Good luck!