Browse topics

  • Governing law
    Name Law or Code?

    The Civil and Commercial Code of the Argentine Republic ('CC Code')

    Code

    The Commercial Loyalty Law (Law number 22,802 as amended)

    Law

    Customers' Protection Law (Law number 24,240 as amended)

    Law

    Personal Data Protection Law (Law number 25,326 as amended)

    Law
    Decree 961/2017 and Resolution 915/2017 (of the Secretariat of Commerce modified the regulations of the conditions for those who organizse or promote contests, draws and sweepstakes with the aim of simplifying certain formalities)

    Law

    Note: Prize promotions regulations in Argentina are the responsibility of each province. Argentina is subdivided into twenty-three provinces (provincias) and one autonomous city, the City of Buenos Aires.  Even though the provinces and the City of Buenos Aires exist under a federal system, they have their own constitutions, and local regulations. Organisers/sponsors must be aware of the applicable legislation for the provinces included within the territory.

    Last modified 8 Jan 2019

  • Extra-territoriality

    Yes. Even when a chance-based game or skill-based contest is solely online and no promotion takes place in Argentina, if it is open to Argentinean residents, it will be subject to the laws of our countrArgentinay. As a consequence, national regulators might enforce rules against organiszers/companies operating abroad.

    Last modified 8 Jan 2019

  • Skills competitions

    Yes, but ensure that:

    • The purchase of a product or service is not a requirement in order to be able to participate in the promotion; the elements required to enable a person to participate should be made available for free to anybody willing to participate;

    • No element of chance should be used to determine the winner of the promotion;

    • The Rules are available in Spanish; and

    • You disclose information regarding prizes, territorial scope and participation requirements.

    Last modified 8 Jan 2019

  • Prize draws

    Yes, but ensure that the purchase of a product or service is not a requirement in order to be able to participate in the promotion. The elements needed to enable a person to participate must be made available for free to anybody willing to participate.

    Last modified 8 Jan 2019

  • Selection of winners

    The terms and conditions of the promotion must be made available to the public and the process through which the winners shall be determined needs to be clearly established, including dates and place where the process will take place. It is suggested that the process be supervised by a Notary Public.

    If the awards are to be determined by chance, the mathematic adjudication used to determine the winner needs to be provided; if this is not possible, an approximate estimation of it needs to be provided.

    The names of the winners shall be published within ten (10) days, counted from the end of the promotion, by the same media used to promote the contest/promotion.

    The terms and conditions should indicate date and place where the prizes will be delivered.

    Last modified 8 Jan 2019

  • Judges

    There are no legal requirements in relation to judges and judging in skill competitions. However, the judging criteria should be clearly stated within the Rules and it´s advisable to include the list of judges.

    Last modified 8 Jan 2019

  • Prizes

    Prizes awarded must be as described in their marketing communications, or reasonably equivalent to the description.

    No forbidden and/or illegal goods should be awarded as prizes.

    Last modified 8 Jan 2019

  • Registration requirements and fees

    Note that in February 2018, the government of Argentina dissolved the National Lottery (LNSE). As a result, at least for now, Argentina no longer requires sweepstakes and contests to be registered. Prior to the dissolution, only promotions/contests in which the winners were totally or partially determined by chance – involving prizes greater than  6,666 Pesos (approx. US$148) – needed to be registered with LNSE and had to meet all the applicable requirements.

    With regard to skill-based contests, they do not require registration. However, the Official Rules must conform to local law. When a prize is awarded to a winner selected by chance a 31% special tax is levied. If the prize is cash, the entity awarding it must withhold and pay for the tax. If the prizes are goods the beneficiary must provide the entity awarding the prize the amount of money requested to pay for the special tax. Specific provincial taxes may apply in different jurisdictions.

    Last modified 8 Jan 2019

  • Other local requirements

    Promoters must provide certain and detailed information in relation to the prize promotion, including the essential characteristics of the prizes offered, and any other relevant terms.

    Conditions expressed in advertisements, brochures, circular letters or any other media are considered to be included in the contract concluded with the consumer, as binding terms.

    In such respect, Organiszers must comply with the requirements as established by Decree 961/2017 and Resolution 915/2017 of the Secretariat of Commerce.

    Last modified 8 Jan 2019

  • Timing

    For chance-based promotions, time is required to request the permit from the Provinces that regulate contests/promotions at a local level. Time and costs involved may vary depending on the Province.

    Note that Provinces regulating promotions/sweepstakes at a local level can be excluded in order to avoid compliance with local regulations.

    Last modified 8 Jan 2019

  • Translations

    Yes, the terms and conditions must be provided in Spanish.

    Last modified 8 Jan 2019

  • Penalties for non-compliance

    According to the Commercial Loyalty Law, the penalties for non-compliance are the following:

    • Fines from AR$500 (approximately US$11) to AR$ 5,000,000 (approx. US$111.000);

    • Suspension for up to 5 years from the providers registries that allow promoters to conclude contracts with the State;

    • Loss of concessions, tax or special credit benefits;

    • Closure of the facility for up to 30 days.

    According to the severity of the breach, and if it is convenient, publication of a notice of the penalty in the same media may occur.

    In case of fraud, criminal actions may be initiated.

    Last modified 8 Jan 2019

  • Restrictiveness of regulations

    Due to the recent dissolution of the National Lottery there are only a few restrictions on prize promotions in Argentine national regulations. However, as previously mentioned, some provinces like Mendoza, Córdoba, Salta, Neuquén and Tierra del Fuego have their own local regulations. In addition, forbidden acts under the Competence Defense Law must be avoided. Advertisements that contain false indications, lead or could lead to mistake and/or are abusive, discriminatory, or lead the consumer to behave in a dangerous or harmful way, must be avoided as well.

    Last modified 8 Jan 2019

  • Regularity of sanctions

    Fines and prison sentences are rarely imposed.

    Generally, in cases of breach, a complaint is submitted to the Consumer's Defense Office, where a monetary sanction can be applied to the non-compliant entity, and it can also be requested that the misleading advertisement be deleted.

    Last modified 8 Jan 2019

  • Key contacts
    Ignacio J. Randle
    Ignacio J. Randle
    Partner Estudio Randle [email protected] T +54 11 5252 0700
    Alejandro M. Massot
    Alejandro M. Massot
    Partner Estudio Randle [email protected] T +54 11 5252 0700

Regularity of sanctions

How frequently does the regulator impose serious sanctions for non-compliance?

Argentina

Argentina

Fines and prison sentences are rarely imposed.

Generally, in cases of breach, a complaint is submitted to the Consumer's Defense Office, where a monetary sanction can be applied to the non-compliant entity, and it can also be requested that the misleading advertisement be deleted.

Australia

Australia

With the Australian States that have stringent rules surrounding trade promotions, powers exist for government officers to investigate concerns.

For example in New South Wales, concerns can be lodged with the Office of Liquor Gaming & Racing whose enforcement policy involves promoting voluntary compliance while applying escalating enforcement action that target industry participants who demonstrate more serious, repeat or sustained contraventions or other misconduct inconsistent with community expectations and the public interest.

If the incident is not a repeated occurrence, it would appear that imprisonment is an unlikely sanction. Usually, a fine is imposed which ranges depending on the gravity of the crime. For example, in 2015, online gambling company Bet365 was fined with a A$2,750,000 (approx. US$1,904,640) penalty after being found guilty of breaching the ACL and deceiving Australian consumers with a false 'free bets' offer. Another example occurred in 2014-2015 which involved the NSW Office of Liquor, Gaming and Racing issuing a fine of A$5,500 (approx. US$3,809) to various bars for irresponsible alcohol promotions and enforcing restrictions such as banning beer keg prizes and banning Barbie themed cocktails which could appeal to minors.

Austria

Austria

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.

Belgium

Belgium

For lotteries, there is low enforcement.

For games of chance, enforcement is high.

Brazil

Brazil

Fines are imposed, however not very often. There are no provisions for prison sentences.

Canada

Canada

Fines and prison sentences are rarely imposed, but they can be quite serious when they are imposed.

Chile

Chile

Fines and prison sentences indicated in the Criminal Code are seldom imposed.

In regard to sweepstakes and competitions permitted by the Law of Protection of Consumer Rights, if the promoter does not comply with their terms or the law, frequently the regulator imposes a fine. Also, if the promoter refuses to deliver a prize to a winning entrant, the entrant may forced fulfilling the promoter to comply with its obligation.

China

China

Prison sentences are rarely imposed.

On the other hand, it is not uncommon to see fines imposed on promoters, mainly for violation of the Anti-Unfair Completion Law, Law on the Protection of Consumer Rights and Interests and related regulations. In particular, there are a number of cases where promoters were fined for offering prizes exceeding ¥50,000 (approx. US$7,270) in lucky draws.

Colombia

Colombia

Although prison sentences are rarely imposed, governmental penalties such as fines are regularly imposed when a prize promotion is being carried out without an authorization or in violation of the specific regulation. Additionally, other penalties can be imposed for the violation of the consumer protection law or the data privacy law.

Czech Republic

Czech Republic

As regards sanctions for non-compliance with regulations specific to prize promotions (i.e. as explained above, mainly consumer protection laws), these are not very common. There are cases where companies have been fined for advertising prize promotions with rules which were not transparent for consumers or pretending to run prize promotions while no actual prizes were awarded (false offers of prizes). Such actions were considered by the regulator to be aggressive, misleading or generally unfair commercial practices towards consumers.

As regards sanctions for unlawful operation of gambling (without a license), these are more common and the regulator in this field imposes serious sanctions for non-compliance. It is therefore important to carefully assess whether the prize promotion does not fulfill the criteria for being understood as gambling in order to mitigate this risk.

Denmark

Denmark

The regulators of the Danish Marketing Practices Act, the Danish Gambling Act and the Danish tax laws can potentially impose fines. Prison sentences are very rarely imposed.

Finland

Finland

When a prize promotion is prohibited, fines are only imposed in cases of non-compliance with the prohibition order.

The more serious sanctions relate to cases which concern prize promotions that amount to lottery or gambling.

France

France

Enforcement is high. However, in practice, the risk of actual sanction is remote in that the French consumer protection authority (DGCCRF) would typically first request the sponsor who would be a first time infringer to comply with the law. If the organizer does not comply, then the DGCCRF would draft a report and send it to the public prosecutor. In case of successful prosecution, sanctions may be severe.

Germany

Germany

Administrative offenses under the RStV, BDSG and HWG are regularly prosecuted by the competent authorities.

Non-compliance under the UWG or BGB is regularly prosecuted under civil law, likewise by competitors or the Wettbewerbszentrale.

Hong Kong

Hong Kong

Fines and prison sentences are rarely imposed.

If the authorities in Hong Kong receive a compliant in relation to prize promotion activity, the Hong Kong police will begin an investigation. If the Hong Kong police are of the view that there is a breach of the laws, action will be brought against the relevant individual/entity.

Hungary

Hungary

The GSA does not impose serious fines frequently in connection with prize promotions. The GSA is more active in connection with unlawful gambling activities carried out in Hungary.

India

India

It is not common for the relevant authorities to impose monetary fines or prison sentences. There have been very few cases in the past, where sanctions have been imposed within India.

Ireland

Ireland

Gaming and Lotteries Acts

There is no appointed regulator. The Irish police force would investigate offenses. However, in practice breaches of the Gaming and Lotteries Acts are rarely investigated or enforced. Therefore, fines and prison sentences are very rare.

ASAI

When a complaint is investigated by the ASAI, a Case Report may be published with details of the complaint. Promotions that breach the ASAI Code must be withdrawn or amended. Further, the contravening advertiser/promoter may also be requested to compensate any consumers adversely affected by the advertisement or promotion. In addition to the above, if any member of the ASAI does not comply with an ASAI decision, it may be subject to penalties including fines and/or suspension of ASAI membership. However, in practice, the ASAI does not issue fines.

Italy

Italy

Fines are frequently imposed if reported by individuals through the dedicated hot line.

Japan

Japan

The CAA does not issue CDOs very often, and fines and prison sentences are rarely imposed.

Luxembourg

Luxembourg

We are not aware of any relevant published case law on this subject matter. There seems to be low levels of enforcement regarding lotteries and prize promotions. The risk of enforcement is higher for actual games of chance (e.g. casino games).

Mexico

Mexico

Profeco is likely to use some of its powers if a prize promotion does not comply at least with the general requirements indicated in the Other local requirements section, such as:

  • To instruct the offeror to stop the promotions;

  • To instruct the correction of the promotional content;

  • To close down the operator; and

  • Impose any other sanction applicable by law (arts. 35 and 128bis of the Consumer Law).

Fines are common. However, prison sentences are rare.

Profeco and the Ministry of Interior through the GOG will initiate an investigation upon receiving a complaint from any consumer. However, it is common for Profeco to realize random reviews in commercial establishments.

Netherlands

Netherlands

Fines and prison sentences are rarely imposed (unless not compliant with the Games of Chance Act or Code of Conduct).

If promotions are not compliant, for example the total value of prizes to be won exceeds the amount of €100,000 (approx. US$112,000), the KSA might become involved but this is relatively rare.

New Zealand

New Zealand

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.

Nigeria

Nigeria

The Code is tightly enforced and sanctions (by way of reprimands, warnings, fines and reduction in scope of licenses) are imposed as needed against persons and corporate entities that violate the Code.

Norway

Norway

Prison sentences are rarely imposed, but fines can be applied. There is currently a strong focus on data protection, and recent amendments to the MCA have made it easier to fine companies immediately upon breach of the law.

Poland

Poland

No information publicly available.

Portugal

Portugal

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

Romania

Romania

No information has been released by the Romanian competent authority, and therefore no information can be provided.

Russia

Russia

Rarely imposed for skill-based competitions.

Fines are imposed more often for violations in relation to lotteries.

Saudi Arabia

Saudi Arabia

There are reports of competent authorities implementing the provisions of the ACFR, and imposing penalties on a number of companies for violation of its promotion/competition requirements. However, full details of such cases are not published, and in any event specific details of all cases are not publicly available.

More generally, it is important to note that competent authorities are becoming increasingly active in ensuring that local laws are complied with and actively encouraging consumers to report violating promotions/competitions.

Singapore

Singapore

According to the MHA website, since the RGA came into operation on 2 February 2015, several hundred websites which provide remote gambling services have been blocked. In addition, financial institutions and financial service providers have been directed to block credit card and other payment transactions related to remote gambling.

It is expected that the Singapore Police Force will continue to take enforcement action against those who provide illegal gambling services from both remote and land-based sources.

South Korea

South Korea

Very rarely. All of the KFTC enforcement actions involving prize promotions in the past ten years (the public records for which are accessible on the KFTC website) have been subject only to a corrective order without any fines or criminal sanctions.

Spain

Spain

Fines are imposed from time to time.

Sweden

Sweden

The Swedish Gambling Act entered into force the on 1 January 2019, and so far, no enforcement actions have been taken. It remains to be seen how actively the Swedish regulator will enforce the rules in relation to prize promotions.

The Swedish Consumer Agency regularly issues orders and injunctions under penalty of fines to prevent violations of the Swedish Marketing Act.

Thailand

Thailand

Non-compliance with the TGA is a common occurrence, particularly in relation to obtaining a license. As of yet, only fines have been imposed.

Please note that the TGA is in the process of being amended and is currently being considered by the House of Representatives. Under the Bill, prize promotions by risk-taking will be governed by a new Act, the 'Prize Promotion by Risk-Taking Act.'

Pursuant to the most recent version of the Bill, arranging a Prize Promotion without a license would be subject to higher sections including imprisonment of 2 years and a maximum fine of ฿80,000 (approx. US$2,530) or both.

Turkey

Turkey

Prison sentences are rarely imposed, but fines and prohibition from arranging a prize promotion for two years can be applied.

Ukraine

Ukraine

Serious sanctions are rarely imposed. As a matter of practice, serious sanctions could be imposed by the Antimonopoly Committee of Ukraine, if, for example, misleading information (which is very broadly interpreted under Ukrainian law) in advertising or comparative advertising were distributed.

United Arab Emirates - Dubai

United Arab Emirates - Dubai

In the UAE there is generally no access to relevant cases to give details of which sanctions have been imposed. Only a small number of cases are made available to the public, and none of these are relevant to trade promotions.

United Kingdom

United Kingdom

Fines and prison sentences have rarely been imposed.  However, the introduction of GDPR in May 2018 raises the possibility of more regular fines for breaches of data protection law by promoters.

It only takes one complaint for the ASA to investigate a promotion, and adverse ASA adjudications are very common (5-15 a week). But while an adverse ASA adjudication can cause bad publicity, it does not carry a monetary sanction.

United States

United States

Overall Summary

Regulators have not frequently imposed serious sanctions for non-compliance except in cases of promotion schemes that were merely a form of disguised gambling or misleading (e.g. a failure to adequately disclose an AMOE). There have been class actions filed under state unfair trade practice cases from time to time in connection with promotions where some purchase or payment was required (e.g. text to enter games where there was a premium text charge imposed).