Is a social media giveaway a trade promotion?
A giveaway that promotes a business and picks winners at random is generally a trade promotion lottery under state and territory law. NSW describes a trade promotion as a free-entry lottery used by businesses to promote their goods or services. South Australia says a competition decided by skill is not a lottery. A competition where entry needs only a minor test of skill, such as answering a simple question, and the winner is then drawn, is still a trade promotion. Entry must generally be free, though NSW and South Australia allow entry that requires buying the promoted goods or services, and NSW specifies that they must be at their normal retail value.
When do you need a permit?
Thresholds differ between states and territories, and the rules that apply depend on where entrants live. In NSW, an authority is needed if the total prize value of a single trade promotion exceeds $10,000. An authority can cover one, three or five years, and where one is needed, the promotion's rules must go to NSW Fair Trading at least 10 working days before it starts. In South Australia, a licence is needed for a major trade promotion with total prizes of $5,001 or more, and for any instant prize promotion regardless of value. In the ACT, a permit is needed unless the total prize value is $3,000 or less. Check every other state or territory you accept entries from.
What do Meta's promotion rules say for Facebook?
Meta's policy for Pages, groups and events says that if you use them to announce or run a contest, giveaway or sweepstakes, you must make sure it complies with legal and regulatory requirements, such as official rules, offer terms, eligibility and registration with authorities. Entrants must release Meta from liability and acknowledge that Meta does not sponsor, endorse or run the promotion. The policy also says a promotion must not require or encourage participants to share, repost, tag others or otherwise publicise it. That rules out the common 'share and tag a friend to enter' format on Facebook. Meta also says it will not help you run the promotion.
What do Instagram's promotion guidelines add?
Instagram's guidelines say you are responsible for the lawful operation of a promotion, including official rules, offer terms and eligibility requirements such as age and residency limits, and compliance with rules on prizes, including registration and regulatory approvals. You must not tag content inaccurately or encourage people to tag themselves in photos they are not in. Each promotion must include a complete release of Instagram by each entrant and an acknowledgement that Instagram does not sponsor, endorse or administer it. Instagram also says it cannot advise whether you need consent to use content entrants submit, so cover that consent in your terms.
What should the terms and conditions cover?
Write the terms before the post goes live and link to them from the post. Meta's policy also requires you to give notice and get explicit consent if you collect information from people who interact with your Page, and to make clear that you, not Meta, are collecting it. NSW says the rules should specify how unclaimed prizes are dealt with, and where an authority is needed and the rules set no timeframe, the prize must be kept for at least three months. At a minimum, the terms should cover:
- The promoter (your business name and contact details)
- Who can enter, including age and residency limits
- The entry method, opening date and closing date and time
- The prize, its value and any conditions
- How and when winners are chosen and contacted, and what happens to unclaimed prizes
- The Meta or Instagram release and non-endorsement wording
Which prizes cannot be offered?
NSW lists prohibited prizes for trade promotions. They include firearms and other prohibited weapons, tobacco, smoking or vaping products, cosmetic surgery and similar procedures, and liquor above set volumes: more than 20 litres where the alcohol content is 20 per cent or less by volume, or more than 5 litres where it is above 20 per cent. Other states and territories have their own rules. Check the prize against the rules of every state you accept entries from, and set an age limit in your terms where the prize suits adults only. Describe the prize and its value plainly, so nobody can say it was misrepresented.