Browse topics

• Governing law

  Name	Law or Code?
  *Game Law (Decree-Law no 422/89, 2, December as amended) *The Gambling Law is the main regulation on prize promotions. The remaining regulations correspond to general rules applicable to related aspects.	Decree-Law* *In general terms, the difference between Decree-Law and Law is that within the scope of the 'Decree-Law' the legislative process operates via the government and in the scope of 'Law', the legislative process operates via the Parliament
  Consumer Act (Law no. 24/96, 31 July as amended)	Law
  General Data Protection Regulation ("GDPR") (a draft proposal of law for the implementation of GDPR is at the Parliament for discussion)	Regulation
  Data Protection Law (Law no. 67/98, 26, October as amended), which in accordance with Data Protection Authority position, remains in force to the extent it is not in contradiction with GDPR	Law
  Privacy and Electronic Communications Law (Law no. 41/2004, 18, August as amended)	Law
  Advertising Code (Decree-Law no. 330/90, 23, October as amended)	Decree-Law
  Unfair Commercial Practices Regulation (Decree-Law no.57/2008, 26, March as amended)	Decree-Law

  Note: The right to provide State Social Games (e.g. lotteries) offline and online is an exclusive right of Santa Casa da Misericordia and no third entities may provide such games in Portugal. Furthermore, the right to provide 'fortune games' (casino games, bingo, sports betting, etc.) online and offline follow a specific and very restrictive legal framework which is not included in this advice as it is outside the scope of guidance on prize promotions. Also, sales with price reduction (discounts) are outside the scope of the present guide.

  Last modified 15 Apr 2019

• Extra-territoriality

  Yes, if the prize promotion is addressed to Portuguese consumers and/or is opened to participation in or from Portugal. There are several elements which may indicate that a prize promotion is addressed to Portuguese consumers (e.g. terms and conditions in Portuguese language, online prize promotion made available on a website under a domain name .pt (or even if on an international domain name, but the website is written in Portuguese), advertising in Portugal or in channels addressed to Portugal, etc).

  In any case, if the prize promotion is opened to participants from Portugal, it is likely that Regulators apply/enforce rules against entities operating abroad.

  Last modified 15 Apr 2019

• Skills competitions

  Yes, but ensure:

  • That neither the eligibility, the mechanics of the skill competition nor the selection of the winners depends on chance (even if combined with skill);

  • That no skill competitions are run where the entrant has to use machines or other devices and in which the result depends exclusively on the skill of the player but that may result in payment (as a prize) of money, chips or other goods with economic value (even if of small value);

  • Clear terms and conditions (including full information on the skill competition) shall be provided to the participants for acceptance prior to the beginning of the competition.

  Last modified 15 Apr 2019

• Prize draws

  Yes but depends on prior authorization from local competent authority. Please note that Prize Draws are considered to be games similar to fortune games which depend on chance or on chance combined with skill and, therefore, they are subject to specific legal requirements:

  • It must not be performed by entities with profitable purposes except as a means to promote and advertise products or services provided by such entities;
    
    
  • The participant may not incur any expenses other than post or telecommunication expenses (with no value added, whatsoever), or expenses higher than the cost of the product or service that the contestant is intended to claim;
    
    
  • It cannot be similar to or use themes from fortune games (such as poker, fruits, roulette, dice, bingo, numbered lotteries, etc);
    
    
  • Worldwide prize draws are not accepted for authorization by the competent authority (only local prize draws).

  Please note that Game Law (applicable to contests/competitions depending on luck/chance or luck/chance combined with skill) was recently amended and one of the relevant amendments was the transfer of competences to authorize such contests/competitions from SGMAI (Secretaria Geral do Ministério da Administração Interna) to the (i) President of Municipality (in case the contest/competition is limited to the territorial area of a specific municipality); or (ii) President of Municipality of  the residence or headquarters of the entity promoting the competition/contest (when it is not limited to the territorial area of one municipality).

  In general terms, the amendments entered into force on 1st, January, 2019. However, from a formal standpoint, the transfer of competences may be refused by the Municipality, in which case SGMAI will, in principle, remain competent for such purposes. The competence to authorize prize draws shall be assessed on a case by case basis.

  Note as above in the Governing law section, the regulation of games of fortune and state-run social games (such as state lotteries), as well as sales with price reductions (discounts), are beyond the scope of this guidance.

  Last modified 15 Apr 2019

• Selection of winners

  Prize draws

  In the scope of SGMAI procedure, the selection of the winners must be observed by a representative of the General-Secretary of Ministry of Internal Affairs or, where the selection is carried out using a computer program, such program must be provided to the General-Secretary of Ministry of Internal Affairs with a request for authorization for the intended means of selection. Among other aspects, the promoters must publish the day of the winner selection and the day to claim the prize in the same media as used to advertise the competition and the prizes must be claimed within 90 days after the selection of the winners.

  However, depending on the competent Authority, which shall be assessed on a case by case basis, authorizing the prize draw, the rules may be different, as the recent amendments grant to the President of Municipality the authority to establish the conditions which shall be complied with for a prize draw for which the transfer of competences has been accepted.

  Skill competitions

  If the selection of winning entries is open to subjective interpretation, an independent judge, or a panel, should be appointed. Those appointed to act as judges should be competent to judge the subject matter of the competition. The full names of judges should be made available on request.

  Last modified 15 Apr 2019

• Judges

  Skill competitions, where the selection of winning entries is open to subjective interpretation, should be judged by an independent judge, or a panel. Those appointed to act as judges should be competent to judge the subject matter of the competition. The full names of judges should be made available on request.

  Last modified 15 Apr 2019

• Prizes

  For prize draws, prizes must be goods or services with economic value, not cash, and cannot be substituted with cash.

  Without prejudice to what is mentioned in the Skills Competitions section, for skill competitions, prizes may in principle be granted in cash; however, the authorities are not entirely consistent on this point.

  Furthermore, please note that there may be specific regulations prohibiting the award of certain goods as prizes (for example tobacco products, weapons etc).

  Last modified 15 Apr 2019

• Registration requirements and fees

  Registration Requirements

  For prize draws – filing of a prior authorization request with the competent Authority (to be assessed on a case by case basis) is required.

  Fees/Taxes payable

  For prize draws – when filing the prior authorization request with the competent Authority, the payment of an official fee of €500 (approx. US$560) is required.

  Regarding taxation issues, all prizes to be delivered are subject to Stamp Duty at a 45% rate. The tax is due at the moment the prize is granted to the beneficiary and the amount of the tax must be paid by the entity granting the prize by the 20th of the month after the month in which the prize is granted.

  In case SGMAI is the competent Authority (to be assessed on a case by case basis), within 8 days after the end of the 90 day period (such 90 day period starting from the date of selection of the winners), the promoter must present evidence to the General-Secretary of Ministry of Internal Affairs that the tax due has been paid.

  Last modified 15 Apr 2019

• Other local requirements

  All of the details of a prize competition must be disclosed in the respective Terms and Conditions and an indication of the prizes, their value and contact details of the promoter and all relevant dates of the promotion must be included. The procedural rules and regulations must be accessible for consultation, at all times during the promotion.

  All promotional materials regarding the prize draw and the Terms and Conditions should have a specific reference to the authorization number granted by the General Secretary of Ministry of Internal Affairs.

  General Advertising rules are fully applicable to prize draws and skill competitions which means that advertising must abide by all principles set out in the Advertising Code (Decree Law no 390/90, October, 23 as amended by Law 8/2011, April, 11). In particular, the advertising of the promotion must refer to all its main conditions and may not mislead the consumer.

  Data Protection provisions are fully applicable to prize draws and skill competitions, which means that any marketing lists must comply with data protection laws and Regulations..

  Last modified 15 Apr 2019

• Timing

  Yes.

  For prize draws: in case SGMAI is the competent Authority (to be assessed on a case by case basis),  the authorization request and the terms and conditions shall be submitted submitted, at least 15 days before the prize promotion starts to provide sufficient time for authorization to be considered and granted.

  Terms and conditions of the prize draw must be made available to the participants before the beginning of the promotion and, if possible, expressly accepted by the participants.

  Regarding skill competitions, terms and conditions of the skill competition must be made available to the participants before the beginning of the promotion and, if possible, expressly accepted by the participants.

  Furthermore, the timings should provide sufficient time for compliance with data protection requirements prior to the beginning of the prize draw or skill competition (eg. ensuring an appropriate privacy policy is in place and including appropriate tick box functionality for consents).

  Last modified 15 Apr 2019

• Translations

  Yes, translation into Portuguese is required.

  Last modified 15 Apr 2019

• Penalties for non-compliance

  Breaching the applicable provisions in connection with prize promotions and skill competitions can be sanctioned as an infringement to the Game Law, being considered as administrative offense punished with fines from €250 (approx. US$280) up to €2500 (approx. US$2,800) per breach (if the offender is a natural person) or from € 2,500 (approx. US$2,800) up to €24,940.00 (approx. US$28,000) per breach (if the offender is a legal person). Ancillary penalties may also be imposed (e.g. the equipment used and any monies obtained may be seized, a ban on performing activities in the establishment for a period of up to 6 months may be applicable).

  The failure to comply with data protections and privacy legal requirements and formalities may result in civil, criminal and administrative liability. At this stage there is still no law implementing GDPR in Portugal. In accordance with the last draft proposal of law made available (not yet approved and still in discussion in the Parliament), crimes may be punished with imprisonment up to 4 years (or daily fines for periods up to 480 days (the court determines an amount to be paid per day and the number of days for which the agent shall be punished), and administrative offenses may be punished with fines up to €20 000 000 (approx. US$22.4m) or up to 4% of the total worldwide annual turnover of the preceding financial year, whichever is higher. Failure to comply with the rules on sending direct marketing communications is punished as an administrative offense with fines up to €5,000,000 (approx. US$5.56m) per infringement. Ancillary penalties may also be imposed.

  Furthermore and depending on the conduct, it may considered as a breach of general consumer provisions, including the Consumer Protection Act, Unfair Commercial Practices, Advertising Code, etc.

  In general terms, unfair commercial practices and misleading advertising may generate civil and administrative liability and may be sanctioned with fines up to €3,740.98 (approx. US$4,200) per infringement (if the offender is a natural person) or up to €44,891.81 (approx. US$50,300) per infringement (if the offender is a legal person).

  Ancillary penalties may also be imposed.

  Last modified 15 Apr 2019

• Restrictiveness of regulations

  The legal framework applicable to prize draws is restrictive. There are several legal requirements and formalities, notably prior authorization from the competent authority as well as obligations to present additional documents after the prize draw has been conducted, to the competent authority (e.g. evidence of the delivery of the prizes and the payment of applicable taxes).

  The mechanic of the prize draw is, in general terms, allowed as long as it does not fall within the scope of 'fortune games' (e.g. bingo, casino games, sports betting, etc) or within the concept of 'State Social Games' (e.g. lotteries).

  Finally, GDPR has introduced various obligations around processing personal data which have significant application to prize promotions (e.g. use of submissions including personal data, winner publicity, etc.).

  Last modified 15 Apr 2019

• Regularity of sanctions

  Fines may be imposed and the amount will depend on the circumstances.

  Last modified 15 Apr 2019

• Key contacts
  

  João Costa Quinta

  Partner DLA Piper ABBC joã[email protected] T +351 21 358 36 20 View bio

  

  Margarida Leitão Nogueira

  Senior Associate DLA Piper ABBC [email protected] T +351 21 358 36 20 View bio