Raffles vs Trade Promotion Lotteries: Australian Compliance Guide

Competitions are a great way to build buzz around your brand or raise funds for a good cause. But in Australia, the law draws a clear line between a “raffle” and a “trade promotion lottery” - and the rules you need to follow are quite different.

If you’re planning a giveaway, prize draw or ticketed fundraiser, it’s important to get the classification right before you launch. In this guide, we’ll break down the difference, highlight when permits or licences may be needed, and walk you through the key compliance steps so you can run your promotion confidently.

What’s The Difference Between A Raffle And A Trade Promotion Lottery?

While both involve chance and prizes, the legal purpose and structure sets them apart.

Raffles (Fundraising Games Of Chance)

• Typically run by charities, not-for-profits, community groups or clubs to raise funds.
• Entry is usually by paid ticket (consideration), and winners are chosen randomly.
• Heavily regulated at the state and territory level, with specific conditions around who can run them, ticket pricing, prize records and how proceeds are used.

Because raffles are fundraising activities, businesses cannot generally run a “raffle” for profit. If you’re a business looking to promote your products or services with a prize draw, you’re usually looking at a trade promotion instead.

Trade Promotion Lotteries (Marketing Promotions)

• Run by businesses to market goods or services and boost engagement or sales.
• Entry is free and linked to a promotional activity (for example, joining a mailing list or buying a product to get an entry). A purchase may be required, but there must be no premium charged for entry beyond the ordinary product price.
• Chance determines the winner (if skill determines the winner - like a judged answer - it may be a “game of skill” and subject to different settings).

Trade promotions are common (think “win a weekend away with any purchase this month”). They still need to follow strict rules around fairness, advertising and prize handling - and in some places, a permit may be required.

If you’re unsure which category your idea falls into, it’s worth comparing your concept against these giveaway laws before you lock in your marketing plan.

Do You Need A Permit Or Licence In Australia?

Australia doesn’t have a single national permit for raffles or trade promotions. Instead, each state and territory regulates these activities within its borders. That means your compliance obligations can change depending on where your entrants live (not just where your business is based).

Raffles: Charity And Community Fundraising

Raffle permits or authorisations are often required, with different thresholds and conditions. You’ll also find special categories (like “minor raffles”) with streamlined rules for small prizes or low-value ticket sales. For a deeper dive, check:

• National overview of raffle laws in Australia
• State-specific snapshots for NSW, Queensland and Victoria

Other states and territories have their own rules, so always check the local regulator before selling tickets. If your raffle is online and open nationally, you’ll need to meet the rules in every jurisdiction where entrants are based.

Trade Promotion Lotteries: Business Promotions

Some jurisdictions require permits for games of chance that promote a business, often depending on total prize value and how the promotion is run. Others don’t require a permit but do impose conditions on advertising, eligibility, draw methods, and record-keeping.

Because the thresholds and conditions change over time, the safest approach is to map your entrant locations and confirm requirements with each state/territory regulator before launch. Build that lead time into your marketing timeline - permit applications (where required) can add days or weeks to your schedule.

Key Legal Requirements For Trade Promotion Lotteries

Even when a permit isn’t required, you still need to comply with broader Australian laws. Here are the big-ticket items small businesses should plan for.

Clear, Fair Terms And Entry Conditions

• Write comprehensive competition terms covering eligibility, how to enter, start and end dates, number of entries, draw/selection method, prize details and any restrictions, winner notification and publication, and how unclaimed prizes are handled.
• Make your terms accessible wherever you promote the competition, and ensure the rules are enforced consistently.
• If you need a hand, consider tailored Competition Terms & Conditions so your promotion is watertight from day one.

Truthful Advertising (Australian Consumer Law)

• Under the Australian Consumer Law, you must not mislead or deceive entrants through your marketing, prize descriptions or odds.
• Avoid fine print surprises - key conditions (age limits, residency, major exclusions, significant costs or steps) should be prominent and easy to understand.
• Review your copy against the rules around misleading conduct, including section 18 obligations, before you launch.

Privacy And Data Handling

• If you collect entrants’ personal information (names, emails, social handles), you should have a compliant Privacy Policy that explains what you collect, why, how long you keep it and who you share it with.
• Tell entrants if data will be used for marketing beyond administering the promotion, and provide a simple way to opt out.
• If you’re running email follow-ups, make sure your approach aligns with Australian spam and email marketing laws.

Prize Restrictions, Draws And Record-Keeping

• Follow any platform-specific rules (for example, social media requirements) and any local restrictions on alcohol, tobacco or high-value prizes.
• Run draws fairly and at the times you’ve advertised. Keep records of entries, draws and winner notification in case regulators ask to see evidence.
• State or territory rules may require public notices for winners or specific steps if prizes go unclaimed - build those into your plan.

Working With Partners And Sponsors

• Document any sponsor contributions or co-branded prizes, including who supplies the prizes, who handles fulfilment and who carries liability for defects or delivery.
• Where a third party helps run the promotion, confirm that entrant data sharing complies with your terms and privacy commitments.

Running A Raffle Lawfully (For Charities And Clubs)

If you’re a charity, P&C, sporting club or community group planning a raffle, your checklist will look a little different to a business trade promotion.

Confirm Your Eligibility And Authority

• Check that your organisation is eligible to run a raffle in your state or territory (some require registration as a not‑for‑profit or charity).
• Apply for authorisation or a permit if required, and confirm any prize value thresholds that change the rules for your raffle.

Raffle-Specific Ticketing And Disclosure Rules

• Ticket content is often prescribed - for example, you may need to display the permit number, price, draw date and prize details.
• Some regulators set caps on ticket prices, define how tickets are sold (including online) and require sequential numbering.

Use Of Funds And Financial Records

• Because raffles raise funds for a cause, there can be strict rules on how proceeds are used and reported.
• Keep clear, auditable records of ticket sales, expenses, prizes and net proceeds directed to the stated purpose.

If you’re fundraising nationally, map out a compliance plan for each jurisdiction you target. The practical details vary, so it’s helpful to review the national raffle law overview alongside the specific guides for NSW, Queensland and Victoria as a starting point.

Online Promotions, Social Media And National Campaigns

Running your promotion online expands your reach - and your compliance footprint. A few practical tips can save headaches later.

Design For Multi-Jurisdiction Compliance

• Use terms that work nationally by default (for example, eligibility set to “Australian residents”), and insert jurisdiction‑specific clauses only when required.
• If some states/territories require permits or extra notices, build those workflows and publication requirements into your schedule.

Platform Rules Still Apply

• Facebook, Instagram, TikTok and other platforms have their own promotion guidelines. Make sure your mechanics (tagging, sharing, comment entries) are permitted.
• Where a platform requires specific wording or disclaimers, include them consistently with your own terms.

Accessibility And Transparency

• Make your terms prominent and easy to find on every promotional touchpoint.
• State how winners will be contacted and when. If you publish winner names, say so upfront and keep the publication accessible for the required period.

What Legal Documents Should You Prepare?

Having the right documents in place makes your raffle or trade promotion smoother and reduces risk.

• Competition Terms & Conditions: The core rules of entry, how winners are chosen, prize details and the promoter’s responsibilities. Custom Competition Terms & Conditions align the mechanics with state rules and platform policies.
• Privacy Policy: Explains how you collect, use, store and share entrant data, and how entrants can access or correct their information. A compliant Privacy Policy is essential if you’re collecting personal information.
• Permit Approvals/Notices: If a permit or authority is required, keep approval letters and numbers on file and include any mandated wording in your ads, tickets or terms.
• Winner Release/Eligibility Declarations: For higher‑value prizes or age‑restricted items, consider a short winner declaration to confirm eligibility and acceptance of the prize conditions.
• Sponsorship/Prize Supply Agreement: If a partner supplies prizes, document who provides what, delivery timelines, publicity rights and liability allocation.

If your promotion has moving parts (co‑promoters, national advertising, high‑value prizes), it’s wise to get tailored operating a competition advice so your documents and processes line up with the law in each location you target.

Common Pitfalls To Avoid

• Calling a trade promotion a “raffle”. If you’re a for‑profit business, avoid “raffle” language - use “giveaway”, “prize draw” or “promotion”, and follow trade promotion rules.
• Charging extra for entry. For trade promotions, don’t add a premium to the product or a separate entry fee. Entry must be free aside from normal product pricing.
• Burying key conditions. Put major restrictions (eligibility, draw date, claiming deadlines, major exclusions) front and centre, not just in fine print.
• Missing permit lead times. Some jurisdictions still require permits for certain chance‑based promotions. Build application time into your campaign plan.
• Loose data practices. Be transparent about marketing use, follow opt‑out requests, and align data handling with your Privacy Policy and platform rules.

Key Takeaways

• Raffles and trade promotion lotteries serve different purposes: raffles are fundraising for eligible organisations, while trade promotions are business marketing activities.
• Permits or authorisations are state‑based. Map where your entrants live and check local rules - especially if you’re running a national or online campaign.
• For trade promotions, strong competition terms, truthful advertising and compliant data handling are essential, even when no permit is required.
• Charities and clubs running raffles must follow ticketing, record‑keeping and proceeds‑use rules, which can differ across jurisdictions.
• Build lead time for permits, winner publication and prize fulfilment, and keep clear records in case a regulator requests evidence.
• Tailored documents - Competition Terms & Conditions, a Privacy Policy and any sponsor agreements - reduce risk and make your promotion run smoothly.

If you’d like a consultation on setting up a compliant raffle or trade promotion in Australia, you can reach us at 1800 730 617 or team@sprintlaw.com.au for a free, no‑obligations chat.