In Japan, draws or competitions decided by chance or on merit, free of charge or tied to a purchase, are allowed but mechanisms involving games of cards are prohibited.
Specifically, for competitions tied to a purchase, national regulations provide for greater restrictions concerning the value of individual prizes and the total prize money on offer.
In addition, if the promotional activity involves the distribution of free gifts, you need to be careful because even some apparently simple formulas such as giving away trinkets in a store can prove illegal.
The local authorities, which pay particular attention to compliance with the rules, constantly monitor prize-draws and -competitions, reserving the right to request clarifications from companies even after the promotion has been completed.
Prize money for draws and competitions – what the national regulations say
It is allowed to include both goods and services in the prize pool but the regulations place limits both on the value of individual prizes and on the total prize pool.
Specifically, in the case of draws or competitions with an obligation to purchase, limits must be respected both on the value of the individual prize, established in relation to the value of the promoted goods or services, and on the total value of the prize pool, which must not exceed 2% of the total sales expected on the promoted goods promoted during the initiative.
In the case of gift with purchase promotions too, there are constraints on the value of the goods that are offered.
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