Browse topics

• Governing law

  Name	Law or Code?
  Games of Chance Act (Glücksspielgesetz, 'GSpG')	Law
  Criminal Act (Strafgesetzbuch, 'StGB'): s. 168 StGB	Law
  Consumer Protection Act (Konsumentenschutzgesetz, 'KSchG')	Law
  Unfair Competition Act (Gesetz gegen den unlauteren Wettbewerb, 'UWG') – General Provisions	Law
  E-Commerce Act (E-Commerce-Gesetz, 'ECG') - relevant where prize promotions are offered online	Law
  EU General Data Protection Regulation (GDPR) Data Protection Act (Datenschutzgesetz, 'DSG')	Law

  Last modified 10 Jan 2019

• Extra-territoriality

  Yes, the courts will apply and enforce domestic provisions in relation to prize promotions, which are published on foreign media, but directed at the domestic public, especially if published on the internet.

  As concerns data protection issues, the GDPR applies also to entities not established in the EU if they offer goods or services to data subjects in the EU or monitor their behaviour.

  Last modified 10 Jan 2019

• Skills competitions

  Yes, but ensure the winner is picked on the basis of skill, not chance.

  The skill element must be predominant, i.e. sufficiently complex to ensure that everyone cannot automatically be considered a winner.

  In addition:

  • The promotion must not invoke a psychological pressure on participants to buy the promoted products or services; and
    
    
  • The conditions for participation must be stated clearly and unambiguously.

  Last modified 10 Jan 2019

• Prize draws

  Unlawful, unless:

  • Participants do not pay to enter.
    
    'Payment' is broadly interpreted by courts and includes a scenario where the purchase of goods or services is a pre-condition for participation and the price for the goods or services is higher than the market rate for such goods or services. A requirement to use a telephone number triggering a higher than standard rate is considered an unlawful payment for entry.
    
    
  • The promotion does not invoke a psychological pressure on participants to buy the promoted products or services; and
    
    
  • The conditions for participation are stated clearly and unambiguously.

  Note: If participants pay to enter, in order to participate, a license, granted under the Austrian Games of Chance Act, is required.

  Last modified 10 Jan 2019

• Selection of winners

  The conditions for both skills competitions and prize draws, including for the awarding of the prizes, have to be transparent to participants.

  Last modified 10 Jan 2019

• Judges

  The applicable laws on prize promotions do not include a provision regarding the selection of judges or judging for skill competitions.

  Nevertheless the conditions for skill competitions and prize draws have to be transparent and easily accessible for participants (Art. 6 Sec 1 Cif 4 ECG).

  Last modified 10 Jan 2019

• Prizes

  The promotion must not invoke a psychological pressure to buy the promoted products or services, nor may it be aggressive.

  A promotion is deemed aggressive if a false impression is given to the consumer that the prize has already been won, will be won, or will be won upon undertaking specified activities and:

  • There is no prize or benefit; or
    
    
  • The prize will be awarded only upon paying an amount or assuming costs.

  Last modified 10 Jan 2019

• Registration requirements and fees

  Registration Requirements

  Certain prize draws (e.g. lotteries) require an authorization from the Ministry of Finance and are subject to strict regulations.

  Fees / Taxes payable

  Certain prize draws (e.g. lotteries) require payment of taxes.

  Prizes from promotional free of charge games are subject to a tax of 5% of the total value of all prizes (if the value of all prizes exceeds €10,000 (approx. US$11,203). The prize promotion organizers or contracting parties are liable for the tax.

  Last modified 10 Jan 2019

• Other local requirements

  For business-to-consumer promotions, supporting terms and conditions must be in German.

  For business-to-business promotions the use of German language is recommended but not mandatory.

  Last modified 10 Jan 2019

• Timing

  Austrian laws do not require any registration of terms and conditions of prize promotions.

  But time should be allowed to deal with data protection issues (e.g. ensuring an appropriate privacy policy is in place and including appropriate tick box functionality for consents).

  Last modified 10 Jan 2019

• Translations

  For promotions aimed at consumers, the terms and conditions must be in German.

  In respect of business-to-business promotions, the use of German language is highly recommended but not mandatory.

  Last modified 10 Jan 2019

• Penalties for non-compliance

  According to Art.168 Sec 1 Criminal Code the organization of a game in which profits and losses exclusively or predominantly depend on chance or which is expressly prohibited may result in monetary fines of up to 360 times the daily rates* of the conducting person's average daily income or imprisonment for up to six months.

  (*The court determines a certain amount of the fine dependent on the economic capacity of the infringer. A daily rate for an individual may range from €4 – €5,000 (approx. US$4,400 – $5,600). Businesses conducting such games are subject to a monetary fine of up to 40 times the business's average daily profit (calculated by dividing the annual return by 360).)

  Art.52 Games of Chance Act provides for administrative penalties when violating provisions of this Act.

  The conduct of illicit draws is punished by the authority with a fine of up to €22,000 (approx. US$24,646).

  The E-Commerce Act includes administrative penalties with a fine of up to €3,000 (approx. US$3,361) in Art. 26, when violating the information requirements (transparent and easy access to the conditions) applicable to prize promotions.

  Unlawful conduct of promotional games may be determined as misleading practice under the Austrian Unfair Competition Act, especially if the announced prizes are not awarded.

  In such cases civil claims for injunctive relief, for cease and desist and for damages can be filed as well as a claim for publication of the judgment can be made.

  Additionally the confiscation of infringing products can be ordered by the authority according to Art. 53 Games of Chance Act.

  Finally, there is the possibility that the personal data processing aspects of the promotion could breach GDPR, which has maximum fines of up to the higher of:

  • €20 million, or
    
    
  • 4% of the promoter’s worldwide annual revenue.

  Last modified 10 Jan 2019

• Restrictiveness of regulations

  In Austria there are only a handful of provisions setting out requirements regarding prize promotions. Those provisions are not unduly onerous, as there is no registration or other formality requirement. Therefore most prize promotion mechanisms are allowed as long as it is not a game of chance as defined by applicable Austrian gaming laws. Also the provisions of the Unfair Competition Act prohibiting misleading or aggressive prize promotions need to be complied with. Finally, GDPR has introduced various obligations around processing personal data which have significant application to prize promotions (eg. use of submissions including personal data, winner publicity, etc.).

  Last modified 10 Jan 2019

• Regularity of sanctions

  Administrative fines are rarely imposed by the competent regional administrative authorities (Bezirksverwaltungs-behörden). In the few existing cases the fines have always been moderate.

  Note: Prize draws that are games of chance, as defined under the Austrian Games of Chance Act, require a license. Their operation without a license is a criminal offense.

  Misleading practice due to unlawful conduct of promotional games often give rise to complaints of competitors. A few complaints result in proceedings in front of the courts.

  Last modified 10 Jan 2019

• Key contacts
  

  Sabine Fehringer

  Partner DLA Piper Weiss-Tessbach [email protected] T +43 1 531 78 1460 View bio

  

  Veronika Appl

  Senior Associate DLA Piper Weiss-Tessbach [email protected] T +43 1 531 78 1465 View bio

  

  Stefan Panic

  Senior Associate DLA Piper Weiss-Tessbach [email protected] T +43 1 531 78 1034