Browse topics

  • Governing law
    NameLaw or Code?
    Gambling Act 2003 ('Gambling Act') Law
    Fair Trading Act 1986 ('Fair trading Act') Law
    Privacy Act 1993 Law

    Last modified 10 Feb 2017

  • Extra-territoriality

    If any element of gambling is organized or conducted in or from New Zealand, it must comply with the Gambling Act.

    The Gambling Act bans the advertisement or promotion in New Zealand of an overseas-based gambling activity (including prize promotions which meet the definition of gambling).

    Otherwise, it is not illegal for someone in New Zealand to participate in gambling over the internet if that website is not in New Zealand.

    Last modified 10 Feb 2017

  • Skills competitions

    Yes, but the winner must be determined only on the basis of skill and not chance, particularly if the entrant pays to enter (including buying a product in order to be eligible to enter).

    If a prize promotion requires no purchase or consideration to enter, ie simply a skill question, the Fair Trading Act would apply. The main prohibitions under the Fair Trading Act are the prohibitions on misleading and deceptive conduct and false, misleading or unsubstantiated representations.

    If the outcome is partly based on skill and partly based on chance (for example a skill question, with the correct answers going into a draw) a prize promotion might be considered as an authorized gambling activity under the Gambling Act if it meets the requirements of a 'sales promotion scheme'. The requirements are listed below:

    • Participation in the prize promotion requires purchase of the goods or services being promoted for a price not exceeding the usual retail price.

    • The entrant is not required to pay direct or indirect consideration to enter the promotion (other than purchasing the relevant goods or services).

    • The date or period over which the outcome of the promotion will be determined is clear to the entrant at the time and place of sale.

    • The promotion is run by the creator, distributor or vendor of goods or services to promote those goods or services.

    • The promotion does not involve a gaming machine nor a restricted or prohibited prize.

    Last modified 10 Feb 2017

  • Prize draws

    A sweepstake is considered a lottery under the Gambling Act and as such will be permitted as a prize promotion if it meets the criteria of a 'sales promotion scheme' (defined in section regarding skill based competitions). Otherwise, the gambling will normally be unlawful unless it is organized by a charitable society who receives the proceeds. Also, a license may be required from the Department of Internal Affairs, depending on the total value of the prizes and the turnover of the gambling.

    Where a product purchase is not required and no other entry fee is paid to enter a prize draw, a license or permit is not required. This is because the entrant is not 'paying or staking consideration seeking to win money' and as such it does not amount to gambling. However, the Fair Trading Act would continue to apply (as above).

    Last modified 10 Feb 2017

  • Selection of winners

    Prize promotions that are run as 'sales promotion schemes' do not generally have specific requirements regarding the selection of winners and award of prizes.

    Where a sales promotion scheme meets the definition of 'remote interactive gambling', as defined in the Gambling Act, including any aspect of on-line entry, the outcome of the gambling must be determined by way of a lottery ie among other things, the draw must take place after all the participants have entered (note daily draws are permitted).

    Last modified 10 Feb 2017

  • Judges

    Competitions that are entirely skilled based have no requirements for judges or judging.

    Last modified 10 Feb 2017

  • Prizes

    Where a prize promotion amounts to gambling, the prize being offered must not be prohibited under the Gambling Act. It is illegal to offer the following as prizes for a prize promotion:

    • Firearms or explosives

    • Restricted weapons or air guns

    • Any form of liquor and alcohol

    • Tobacco products

    • Commercial sexual services

    • An object more than 50 years old that relates to Maori culture, history or society, and was brought into New Zealand by Maori people, and

    • Vouchers or entitlements to any of the above

    Last modified 10 Feb 2017

  • Registration requirements and fees

    Provided a prize promotion is undertaken as a 'sales promotion scheme' it will not require a license, regardless of the value of the prizes offered.

    Last modified 10 Feb 2017

  • Other local requirements

    If a prize promotion falls within the definition of gambling, it is critical that that the promotion fits within the definition of a 'sales promotion scheme' in the Gambling Act so that it is an authorized gambling activity for the purposes of the Gambling Act.

    Note that the retail value of non-cash prizes must be disclosed to the customer prior to entry into the competition.

    If a competition or promotion amounts to gambling but is not a 'sales promotion scheme', it is likely to be considered as either an illegal gambling activity, or another form of gambling where a license may be required.

    The net proceeds of a gambling activity are required to be used for 'authorized purposes' (essentially, charitable purposes or purposes which benefit the community) so it is generally not feasible to obtain a license.

    Under the Consumer Guarantees Act 1993, any good or service provided by the promoter of goods and services must be reasonably fit for purpose.
    It is an offence under the Fair Trading Act to offer a prize having no intention to deliver it as offered. The Fair Trading Act also prohibits misleading and deceptive conduct and making false, misleading and unsubstantiated representations.

    For any personal information collected in connection with a prize promotion or competition, the Privacy Act 1993 requires that entrants are aware of:

    • The fact that the information is being collected

    • The purpose for which it is being collected

    • The intended recipients of the information, and

    • The name and address of the agency that is collecting the information and the agency that will hold the information

    Last modified 10 Feb 2017

  • Timing

    No.

    Last modified 10 Feb 2017

  • Translations

    None required.

    Last modified 10 Feb 2017

  • Penalties for non-compliance

    The Gambling Act provides for penalties for anybody who participates in unauthorized gambling (ie both promoters and participants).

    Fines can be imposed of up to NZ$50,000 (approx. US$35,000) for organizations and up to NZ$20,000 (approx. US$14,000) for individuals. This includes anybody participating in remote interactive gambling and anybody who conducts the gambling.

    Individuals involved in promoting unauthorized gambling may also face imprisonment for a maximum of one year.

    The Gambling Act carries a fine of up to NZ$10,000 (approx. US$7,000) for advertising overseas gambling.

    Last modified 10 Feb 2017

  • Restrictiveness of regulations

    The Gambling Act has limited compliance requirements for sales promotion schemes in New Zealand. There is no restriction on turnover or on the value of prizes awarded, and no license is required.

    The key restriction is on 'remote interactive gambling' where, as noted, the prize winners must be chosen by way of a lottery.

    Last modified 10 Feb 2017

  • Regularity of sanctions

    The Department of Internal Affairs (DIA) will investigate alleged breaches of the Gambling Act.

    Cases are relatively rare as New Zealand generally has a reasonable level of compliance among corporates and unlawful gambling is not a usual part of New Zealand society. We are aware of competitors making complaints to the regulatory body in respect of prize competitions so it is important that compliance is built into planning of prize promotions. Finally, we note that the DIA operates a leniency and co-operation policy in relation to gambling enforcement.

    Last modified 10 Feb 2017

  • Key contacts
    Mark Williamson
    Mark Williamson
    Partner DLA Piper New Zealand [email protected] T +64 9 300 3857 View bio
    Rachel Taylor
    Rachel Taylor
    Partner DLA Piper New Zealand [email protected] T +64 4 474 3256 View bio

Governing law

What are the applicable governing laws or codes for prize promotions?

New Zealand

New Zealand

NameLaw or Code?
Gambling Act 2003 ('Gambling Act') Law
Fair Trading Act 1986 ('Fair trading Act') Law
Privacy Act 1993 Law