Trade promotions are a popular way for businesses to grow their customer base and market their products and services. Each Australian state or territory has different requirements for trade promotions, which must be complied with under the law. This article explains what you need to run a trade promotion in Australia.
What is a trade promotion?
A trade promotion is a competition or giveaway that is free to enter and conducted to promote the goods or services of a registered business. Generally, trade promotions fall into one of two categories:
- Game of chance: The winner is randomly selected, for example, by drawing a name out of a hat.
- Game of skill: The winner is selected by merit. For example, the winner may have the best answer to a question of where they would travel with the prize money.
What do I need to run a trade promotion?
To run a trade promotion, you will generally need:
- a permit or authority (depending on the state/territory you are running your trade promotion in);
- Terms and Conditions, which set out rules for entrants and limit your legal liability; and
When do I need a permit to run my trade promotion?
You do not need a trade promotion permit where your trade promotion is:
- A game of skill; or
- Conducted in Tasmania, Victoria, Queensland or Western Australia.
You will need a permit for games of chance in the following locations, depending on the prize money:
New South Wales
- You will need an authority if your prize value is $10,000 or over.
- An authority can be issued for 1, 3 or 5 years, and multiple promotions can be run under a single authority.
Australian Capital Territory
- You will need a permit if your prize value is $3,000 or over.
- You will need a permit if your prize value is $5,000 or over.
- You will need a permit if your prize value is $5,000 or over and you do not already have a permit in another state or territory.
Running your trade promotion is more than just setting up a prize and getting people to enter. Without the proper permits and legal protection, you may end up damaging your business and reputation, rather than increasing it.