Timing
Is time required to ensure compliance (other than reviewing the terms and conditions)?

Hungary
Prize draws must be reported to the GSA in advance.
Name | Law or Code? |
---|---|
Act 34 of 1991 on Gambling Operations ('Gambling Act') | Law |
Government Decree No. 183/2017. (VII. 5.) on the Gambling Supervisory Authority | Law |
Last modified 21 Mar 2019
Yes, but only if the services are considered as gambling services under the Gambling Act. The Gambling Supervisory Authority ('GSA') exercises its regulatory powers if (i) the gambling services covered by the Gambling Act are operated from the territory of Hungary, or (ii) the customer participates in such games in the territory of Hungary, or (iii) the service is aimed at customers living in the territory of Hungary, particularly when the service is made available in Hungarian, or if advertised in the territory of Hungary.
Accordingly, any enforcement risk against foreign operators seems rather low in the case of prize promotions, even if the prize promotion is regulated by the Hungarian Gambling Act (see regulations on prize draw below). At the same time prize promotions which are considered as gambling (contest of chance) (e.g. poker games, casino games, etc), are heavily regulated and enforced by the Hungarian GSA, including through actions against operators established abroad.
The Hungarian Competition Authority and the Consumer Protection Authority may also enforce consumer protection rules against entities operating abroad if the breach in connection with the prize promotion affects consumers in Hungary.
Last modified 21 Mar 2019
Yes, prize promotions based on skill are allowed; however, if the following conditions are fulfilled it will still be considered as gambling and regulated by the Gambling Act:
Accordingly, if the skill element and the element of chance cannot be separated, it is most likely that such activity will be considered as gambling activity under the Gambling Act.
Last modified 21 Mar 2019
Yes. However, if the conditions of gambling mentioned above are met, it might be considered as a gambling activity, which is unlawful. Under the Gambling Act, 'prize draws' shall be reported to the GSA in advance (but no license is required). Pursuant to the Gambling Act, a prize promotion will qualify as a 'prize draw' only if the following requirements are met:
If these requirements are not met (e.g. participation is skill-based and not based on purchase of goods), the organizer has no obligation to notify the GSA and the provisions of the Gambling Act will not apply, unless the activity is considered as gambling activity, e.g. because participation is not free of charge. Cash prize is not possible in the case of prize draws.
Last modified 21 Mar 2019
There are no specific requirements for prize promotions in general. However, in the case of prize draws, the same degree of publicity shall be awarded to the drawing process, the winning tickets and the prizes as that provided when advertising the 'prize draw'. The GSA may conduct inspections. A notary public must be present at each drawing, unless the GSA prescribed otherwise in the authorization. The organizer shall arrange for the presence of the notary public and shall bear the costs of the notary public.
In the case of prize promotions organized for consumers, it is also strongly recommended to set out the requirements of selecting the winners and awarding the prizes and the possible restrictions in a set of terms and conditions. The terms and conditions have to be transparent for participants before they enter the prize promotion.
Last modified 21 Mar 2019
No, there are no particular requirements in relation to judges (other than the presence of a notary public in the case of prize draws) or judging for skills competitions.
Last modified 21 Mar 2019
As mentioned, a cash prize cannot be awarded in the case of prize draws. Other than that, there are no particular restrictions on prizes awarded; however, in general prizes must be lawful to distribute (e.g. products which cannot be advertised cannot be awarded either, e.g. weapons, tobacco products etc.).
Last modified 21 Mar 2019
Prize promotions do not require any registration or permit in general. However, prize draws must be reported to the GSA for registration at least 10 days before publishing the prize draw.
There is a minor administrative fee for the registration of prize draws (approx. EUR 10 (approx. US$11). The organizer of the prize draw must also pay a so-called supervision fee, which is 0,001% of the value of the prize, but minimum of approx. EUR 15 (approx. US$17), maximum of approx. EUR 1,500 (approx. US$1,700).
The organizer of the prize promotion must pay personal income tax on the prize (if won by a private individual). If the prize is not taken up by the winner, the organizer must pay the value thereof as game tax.
Last modified 21 Mar 2019
The key requirements for prize promotions addressed to the Hungarian market can be summarized as follows:
Prize promotions should:
Last modified 21 Mar 2019
Prize draws must be reported to the GSA in advance.
Last modified 21 Mar 2019
Supporting terms and conditions should appear in Hungarian in order to be clear and unambiguous for participants in Hungary.
Last modified 21 Mar 2019
In the case of infringement of the provisions of the Gambling Act in connection with prize draws, a fine within the range of approx. EUR 150 (approx. US$170) up to approx. EUR 1,500 (approx. US$1,700) may be imposed by GSA. If the provisions of the Gambling Act are otherwise infringed (e.g. conducting unlawful gambling activity), different amounts of fines can be imposed, depending on the type of infringement. The maximum fine (e.g. in the case of gambling activity without a license) is approx. EUR 310,000 (approx. US$347,000). Carrying out gambling activity without a license may involve criminal charges as well. Misleading consumers in connection with prize promotions may lead to consumer protection fines imposed by the Consumer Protection Authority or the Competition Authority.
Last modified 21 Mar 2019
The rules in Hungary allow for the organization of prize promotions quite easily without formal requirements (except for prize draws). Having said this, it should be taken into account that certain prize promotion mechanisms are prohibited in Hungary and therefore cannot be organized. Also, 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 21 Mar 2019
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.
Last modified 21 Mar 2019
Is time required to ensure compliance (other than reviewing the terms and conditions)?
Prize draws must be reported to the GSA in advance.
Last modified 21 Mar 2019