Can a prize promotion be run where there is an element of chance in the selection of the winner?
The Law of Ukraine on 'Prohibition of Gambling in Ukraine' prohibits gambling activity in Ukraine. Within the meaning of the said law, gambling is any game, a compulsory condition of which involves the payment of money by the player, including via e-payment, which will enable the participant to either get the winning (prize) in any form, or to not get it, depending on chance.
The following (among other things) are excluded from the prohibition on gambling and can be run in Ukraine:
- Prize draws based on chance run on a free of charge basis aimed at promoting (popularizing) certain goods, services, trademarks, company names or areas of business offered by a business entity, commercial program which provide for prizes either in monetary or property form, and
Lotteries are subject to separate regulation by the Law of Ukraine on 'State Lotteries in Ukraine'. In particular, the law prohibits holding lotteries without a license. Currently, the application process for lottery licenses is blocked due to the absence of adopted license requirements. State lottery operators are operating based on the respective licenses issued to them prior to adoption of the Law of Ukraine on 'State Lotteries in Ukraine'; thus, existing lottery operators are conducting their activity based on the old licenses, but the order allowing new licenses to be obtained has not been adopted yet.