Running a competition can be a great way to build hype around your brand, grow your email list, launch a new product, or reward loyal customers.
But competitions also come with rules - and in Australia, those rules can change depending on what you’re giving away, how people enter, and which state or territory your customers are in.
If you’ve ever asked “do I need a permit to run a competition?”, you’re not alone. The short answer is: sometimes you do - and it’s not always obvious until you break the competition down properly.
Below, we’ll walk you through how permits work for competitions in Australia in 2026, what to check before you launch, and how to protect your business with the right terms and compliance steps.
What Counts As A “Competition” In Australia?
In everyday language, we call lots of promotions “competitions” - but legally, different types of promos can sit in different buckets, and those buckets have different rules.
Trade Promotions (The Common “Win This Prize” Campaign)
A typical business-run giveaway (for example, “Enter your email for a chance to win a $500 voucher”) is often called a trade promotion.
Trade promotions are usually run for marketing purposes, to promote goods or services. They can be run online, in-store, via social media, or a mix of all three.
Games Of Skill vs Games Of Chance
This is a key legal dividing line for permits.
- Game of skill: Winners are chosen based on skill (for example, judged creativity, best answer, best photo, best slogan). If it’s genuinely judged on skill, it’s often regulated differently.
- Game of chance: Winners are chosen by chance (for example, random draw, barrel draw, RNG generator).
Permits most commonly come up for games of chance trade promotions.
Raffles (Often For Fundraising, But Not Always)
Raffles are a form of lottery-style promotion. While many raffles are run by charities, community groups, or sporting clubs, businesses can sometimes be involved (for example, sponsoring prizes).
Raffles can have their own compliance obligations depending on the state, including eligibility rules, draw requirements, and record-keeping. If a raffle is part of your promotion strategy, it’s worth checking the specific requirements that apply under raffle laws.
“Giveaways” (Social Media Promos)
On social media, you’ll often see promotions described as “giveaways”. Legally, many of these are still trade promotions, and the rules don’t disappear just because the promotion is run on Instagram or TikTok.
If your campaign is a giveaway, you’ll still want to consider the key legal issues covered in giveaway laws, including clarity of entry rules, draw processes, and how you represent prizes.
Do I Need A Permit To Run A Competition?
Whether you need a permit depends on a mix of factors, including:
- whether it’s a game of chance or game of skill
- the state or territory where entrants are located
- the type and value of prizes
- how the promotion is structured (including whether there’s an entry fee or purchase requirement)
In Australia, permits for trade promotions are generally handled at a state and territory level, not through one single national system. That means you may need to check more than one set of rules if your competition is open to entrants nationwide.
When Permits Commonly Apply
Permits are most likely to come up where your promotion is a trade promotion lottery (in plain terms, a marketing competition where the winner is decided by chance).
Some states and territories regulate these more heavily than others, and thresholds and permit requirements can change over time.
It’s also common to see additional rules when:
- the total prize pool is high
- the promotion involves alcohol, gambling-adjacent products, or age-restricted goods
- entry conditions could raise fairness concerns (for example, unclear draw mechanics)
What If It’s A Game Of Skill?
Many businesses choose to run a game of skill to reduce the likelihood that a permit is needed.
That said, “game of skill” doesn’t mean “we say it’s judged” - it needs to be structured like a real judging process with clear criteria and genuine assessment.
If you say it’s judged but still randomly draw a winner (or the judging criteria are vague or not used), regulators can treat it as a game of chance.
What If People Have To Purchase To Enter?
Requiring a purchase to enter can increase risk, because regulators may scrutinise whether your promotion is fair and transparent.
Even if purchase-to-enter promotions can be lawful, they need to be handled carefully, with clear terms and accurate advertising. In some cases, it may be safer to allow a free entry method as well.
State And Territory Differences (Why This Gets Tricky)
If your competition is open to “all Australians”, you may trigger compliance obligations in multiple jurisdictions.
A common approach is to:
- design the competition to comply with the strictest requirements you’re likely to face; and/or
- limit eligibility to certain states/territories (only if that restriction is clearly disclosed upfront)
Because permit requirements can be very fact-specific, it’s often worth getting legal guidance before you launch - especially if you’re spending money on ads and planning for high entry volumes.
How Do I Run A Compliant Competition In 2026?
Permits are only one part of the legal picture. Even where no permit is required, you still need to run your competition in a way that complies with consumer law, advertising rules, and privacy requirements.
1) Make The Prize And Entry Conditions Crystal Clear
Your promotional post and terms should clearly explain:
- what the prize is (and any limitations)
- who can enter (age, location, exclusions like employees/family)
- how to enter
- the opening and closing dates/times (including time zone)
- how and when the winner will be selected
- how the winner will be notified
- what happens if the winner doesn’t respond
If you advertise a prize, you generally need to deliver it as described - and you should avoid “surprises” like hidden fees, extra shipping charges, or conditions that weren’t disclosed upfront.
2) Ensure Your Advertising Isn’t Misleading
Competitions are marketing, which means they’re closely tied to Australian Consumer Law (ACL). If you overpromise or leave out key details, you can create legal risk (and a lot of customer backlash).
Two common compliance pressure points are:
- Misleading or deceptive conduct: for example, suggesting everyone has a real chance to win when the promotion is effectively closed, or advertising a prize that isn’t actually available.
- Price and value representations: for example, inflating the “value” of a prize, or advertising “free” but requiring entrants to pay unavoidable costs.
When you’re designing your marketing copy, it helps to understand the elements of misleading or deceptive conduct so you can pressure-test your claims before you publish.
If your promo includes any pricing language (for example, “Spend $50 and enter”), make sure your pricing and conditions are consistent with advertised price laws.
3) Have A Defensible Winner Selection Process
This matters for both fairness and compliance.
- If it’s a random draw, document how the draw will occur and keep records (for example, date/time, method, who conducted it).
- If it’s a judged competition, document the judging criteria and keep notes showing how the winner was selected against those criteria.
In 2026, it’s common for businesses to use software tools for selection. That can be fine - but you still want an internal process so you can show the promotion was run as promised.
4) Be Careful With Email And SMS Marketing
Competitions often involve collecting emails, phone numbers, or social handles. If you plan to add entrants to a marketing list, you need to do it the right way.
If you’re sending marketing emails (including follow-up promo emails after the competition), your campaign needs to align with email marketing laws, including consent and unsubscribe requirements.
5) Don’t Forget Platform Rules (Instagram, Facebook, TikTok)
Social platforms often have their own promotion guidelines (for example, requiring you to acknowledge the platform isn’t associated with the promo). These aren’t “laws”, but failing to follow them can get your account restricted or your post removed.
Your terms and your post copy should be aligned so you’re not promising one thing publicly and doing another thing in the fine print.
What Legal Documents Do I Need For A Competition?
Most competition problems come from unclear rules and rushed promo copy.
Having the right legal documents doesn’t just reduce legal risk - it also makes your competition easier to run, easier to communicate, and easier to defend if someone complains.
Competition Terms And Conditions
This is your foundation document. Your terms should cover things like eligibility, entry mechanics, prize details, draw/judging process, announcement, and dispute handling.
Many businesses use Competition Terms & Conditions to set out these rules in a single place, so your marketing can stay simple while the details remain accessible and enforceable.
Privacy Compliance (Especially If You’re Collecting Personal Information)
If your competition collects personal information (for example, name, email, phone number, address for shipping prizes), you should consider how you’ll handle it, store it, and disclose your data practices.
In many cases, it’s appropriate to have a Privacy Policy that reflects what you collect, why you collect it, and who you share it with (such as fulfilment partners).
If you’re doing anything more advanced - like using competition entries for profiling, retargeting, or ongoing marketing - you’ll want to be even more careful about consent and disclosures.
Website Terms (If Entries Are Taken Through Your Website)
If you’re running the promotion through a landing page or eCommerce store, your usual website rules still matter, especially around acceptable use, content ownership, and limitations of liability.
It’s worth checking that your site terms and competition terms don’t contradict each other.
Supplier Or Sponsor Agreements (If Someone Else Is Providing The Prize)
If a brand partner is donating or sponsoring a prize, it’s smart to document what they’re responsible for and what you’re responsible for.
This reduces the risk of last-minute surprises like “we can’t supply the prize anymore” or disputes over branding and promotion rights.
Common Competition Mistakes (And How To Avoid Them)
Even well-meaning businesses can run into trouble with competitions - not because they’re doing anything shady, but because promos move fast and the legal details are easy to miss.
Changing The Rules Mid-Competition
One of the fastest ways to lose trust (and create complaints) is changing entry conditions, prize details, or closing dates after people have already entered.
If you absolutely must change something, you’ll want to do it transparently and in a way that’s permitted under your terms - and even then, it may be better to cancel and relaunch.
Not Awarding The Prize Properly
If you run a competition, you need to follow through.
Issues often arise when:
- the winner can’t be contacted and there’s no redraw process
- the business delays sending the prize without explanation
- the prize turns out to be materially different to what was advertised
Clear terms and a clear fulfilment process go a long way.
Inflating Prize Value Or Using “Free” Carelessly
“Win a $2,000 prize!” gets attention - but only if it’s true and supportable.
Be especially careful about how you describe prize value, “recommended retail prices”, and whether the winner will have to pay anything (including shipping). These issues often overlap with advertising compliance obligations.
Collecting Entries Without Thinking About Data Handling
Competitions can generate a lot of personal information very quickly. That can create privacy risk if you don’t have a plan for:
- where the data will be stored
- who can access it
- how long you’ll keep it
- how you’ll handle requests to delete it
Putting privacy steps in place early is usually far easier than trying to retrofit compliance once you’re already running ads and receiving hundreds (or thousands) of entries.
Not Checking Permit Requirements Until Launch Day
Permits (where required) can take time. If your marketing calendar is tight (for example, you’re running a flash promo, seasonal campaign, or product drop), this can become a real business blocker.
A practical way to avoid this is to confirm the “permit question” before you brief your designer, schedule your posts, or commit to ad spend.
Key Takeaways
- Whether you need a permit depends on the type of competition (skill vs chance), prize value, and which state/territory your entrants are in.
- Even if no permit is required, competitions still need to comply with Australian Consumer Law, including rules against misleading advertising and unclear prize claims.
- Clear, well-structured Competition Terms & Conditions help you run the promo smoothly and reduce complaints and disputes.
- If you collect personal information as part of the entry process, you should think about privacy compliance and how you’ll use entrants’ data after the competition ends.
- Marketing follow-ups (especially email) should be handled carefully so you’re not contacting people without proper consent.
If you’d like a consultation on running a competition for your business, you can reach us at 1800 730 617 or team@sprintlaw.com.au for a free, no-obligations chat.
