Lewis Silkin – A no-purchase-necessary route for chance-based competitions is no longer required in Northern Ireland
See our recent article here.
On April 26, 2022, the Betting, Gaming, Lotteries and Entertainment (Amendment) (Northern Ireland) Act 2022 received Royal Assent (2022 Act). The 2022 Act amends the former Betting, Gaming, Lotteries and Entertainment (Northern Ireland) Order 1985 (SI 1985/1204). It is the first part of a gambling regulatory overhaul program in NI, which has struggled to keep pace with rapid developments in the gambling industry, including the growth of online gambling. . There are future plans to formulate more ambitious legislation, which would, among other things, update online gambling laws in NI.
Among other issues, the law removes the current £1 price limit on the sale of company lottery tickets and raises the limit to a maximum of £100; creates new offenses for allowing children to play slot machines; creates the power to impose a statutory tax on gambling operators; creates the power to publish a code of practice for gaming operators; expands the definition of cheating to include attempted cheating; makes gaming contracts legally enforceable and allows bookmakers and bingo clubs to open on Sundays and Good Friday.
However, the most important part of the new law for promotional marketers and FMCG brands means that from 27 April 2022 the rules for entering chance-based competitions are broadly aligned across the UK. .
Until now, the regimes were different and offering UK-wide sweepstakes was a challenge in the context of NI’s outdated gambling laws. In England, Wales and Scotland, free raffles with no payment to participate are not considered lotteries and therefore fall outside the scope of the ban on lotteries in the Gambling Act 2005. By therefore, they are legal.
What is payment to be entered? This is explained in Schedule 2 of the 2005 Act and states that the cost of buying an item for you to enter a prize draw does not constitute payment, as long as the promoter does not inflate the cost of the product to cover the price or running cost of the promotion. This also includes making a regular telephone call or submitting an entry form by first or second class mail. However, it excludes premium rate calls.
But at NI, the law was much more complex and not aligned with the 2005 law as it contained a broad ban on holding sweepstakes for the public. Among other things, this meant that if, for example, you bought a bottle of water or a packet of candy to enter a sweepstakes in NI, that would be illegal under NI’s gambling laws, even if the cost of the item had not been inflated to cover the cost of the promotion. Although the law has not been enforced by the Police Service of Northern Ireland to our knowledge, and there has been talk of reform for years, it has been difficult for reputable promoters to arrange promotions UK-wide. In 2019, the Northern Ireland Assembly consulted on the matter and the 2022 Act is the result.
The 2022 Act amends the Northern Ireland Ordinance by adding a new section 168(2A) and a new Schedule 15A (which is substantially identical to Schedule 2 of the 2005 GA) – the combined effect of these changes is that chance-based competitions, including raffle prizes, are now legal in NI as long as no payment is required from participants to participate. Annex 15A helpfully clarifies that the purchase of goods at their normal price will not count as payment for participation.
However, “paying to participate” includes charging for entry or increasing the normal cost of the entry way above its standard price. For example, routing entry through a premium rate telephone line, or charging extra to find out who won the competition, would each impose an unusual cost on entry and be considered payment for entering – and would therefore still be illegal under of the NI law. NI’s position in chance-based competitions has therefore been largely in line with the laws and realities in Great Britain (GB) since 2007. This is good news for organizations looking to run promotions across the UK. , as well as for NI consumers. , who were too often left out of Britain-wide promotions. Developers have tended to use no-purchase-necessary (NPN) lanes to deal with NI’s varying legal landscapes. However, depending on the promotional mechanics, it can sometimes be logistically difficult to follow the rules, for example with “golden ticket” type promotions. This means that many promoters have chosen to exclude consumers from NI entirely. Now promoters will no longer have to choose between offering an NPN entry route or excluding NI customers from chance-based promotions, provided no further payment is required to participate in the promotion.
It should be emphasized that the updated laws at NI did not transform the scheme into a carbon copy of UK law. NI law does not use the same terminology as UK law, which distinguishes between two types of events: competitions (skill-based) and raffles (luck-based). The NI Act uses the term “contest” loosely to cover both types of activity and distinguishes between “skill” games (which are legal in NI whether or not participants pay to participate) and games based on chance (which are now legal in NI provided there is no payment to participate). However, normal purchase costs, which have led to NPN qualification for so long, do not count as payment for participation.
Note however that the rules in the Republic of Ireland are even more restrictive than in the UK (and are also awaiting “second phase” reform), so promotions in Ireland will still require care.
NI gambling law is complex and other restrictions may affect draws in specific situations: specialist advice should always be obtained. If you have any questions about this item or any other price promotion related questions, please contact one of our teams: