Can a prize promotion be run where there is an element of chance in the selection of the winner?
Yes, prize promotions based on chance (prize draws also known as 'sweepstakes') are allowed, but ensure:
- Prize draws or sweepstakes should not constitute gambling under the German gambling regulation. Therefore, no payment should be required to enter.
Note: 'Payment' is interpreted to mean that the participant renders a financial sacrifice in order to obtain a chance to win. 'Irrelevant' amounts are excluded, and participation fees of up to € 0.50 (approx. US$0.56) are considered irrelevant; this would include fees paid to use standard telephone and postal services.
- Sweepstakes addressed to consumers should not give the impression that the prize is already won, otherwise the consumer may have a valid claim under s.661a BGB. This would also constitute an unfair commercial practice pursuant to no. 17 of the Annex to s.3 para. 3 UWG.
- The UWG does not differ between skill competitions and sweepstakes, so that the key requirements have to be fulfilled for each (see also Other local requirements section).