The Legal Landscape of Running Competitions & Awards: What Every Organizer Should Know

(This article is provided for general educational and informational purposes only. It does not constitute legal advice and should not be relied upon as such. Laws and regulatory requirements vary by jurisdiction and by individual circumstances. You should seek professional legal advice from a qualified legal practitioner before acting on any information contained in this article.)

Competitions and awards are widely used by businesses and organisations to build community engagement, brand loyalty, and public interest. While they appear simple on the surface, these promotions operate within a complex legal framework — particularly in Australia — and poorly structured competitions can expose organisers to significant regulatory risk.

This article outlines the core legal principles governing competitions and awards, illustrated by an anonymised real-world style example.

Consumer Protection Law: The Foundation of Compliance

Under Australian Consumer Law, any conduct that is misleading or deceptive, or likely to mislead or deceive, is unlawful. This applies equally to competitions, awards, giveaways, and prize promotions.

The most common compliance failures occur when:

• Eligibility restrictions are unclear, incomplete, or hidden in fine print.

• Marketing materials imply that everyone can enter and win, when in fact certain people cannot.

• The practical reality of the promotion differs from what a reasonable consumer would expect.

The legal test is not what the organiser intended, but what a reasonable consumer would understand from the overall presentation of the promotion.

If people reasonably believe they can enter and win a prize — but in fact they cannot — the promotion may breach consumer law.

2. Eligibility and Geographic Scope

Many competitions operate across borders or are described as “international.” This immediately introduces additional risk.

Organisers must ensure that:

• Eligibility by location is clearly defined.

• Any excluded regions or jurisdictions are stated prominently.

• Entry systems do not invite participation from people who are not legally able to win.

Failure to clearly disclose geographic limits can amount to misleading conduct, even if exclusions appear somewhere in the terms and conditions.

Transparency at the point of entry is critical.

3. Trade Promotion & Competition Regulations

Australian states and territories regulate competitions differently. While many skill-based competitions do not require permits, all competitions must still comply with fairness and transparency standards.

This includes:

• Clearly stated judging criteria.

• Consistent application of rules.

• Documented selection processes.

• Accurate representation of prize values and conditions.

Even when no permit is required, regulators may intervene if competitions are poorly administered or misleadingly presented.

4. International Transfers & Sanctions Compliance

When competitions involve cash prizes, goods, or financial benefits, international law considerations may arise.

Many countries impose sanctions that restrict financial transactions and benefits involving certain regions, entities, or individuals. Organisers who offer international prizes must ensure they are not:

• Sending funds to sanctioned jurisdictions.

• Providing benefits to sanctioned individuals.

• Engaging in prohibited international transactions.

Sanctions compliance is not optional and cannot be overridden by promotional promises.

5. Terms & Conditions: Your Legal Backbone

Terms and conditions form the legal contract between the organiser and entrants. They must be:

• Clear and accessible.

• Accurate and complete.

• Consistent with advertising materials.

Key components include:

• Eligibility requirements.

• Entry methods and deadlines.

• Judging process.

• Prize descriptions and limitations.

• Dispute handling and organiser rights.

Well-constructed terms are the primary defence against regulatory action and disputes.

6. Privacy, Content Rights & Minors

Competitions that collect personal information, photos, or videos — especially from minors — trigger privacy and consent obligations.

Organisers must:

• Obtain valid consent for content use.

• Clearly explain how submissions may be used.

• Apply additional safeguards where minors are involved.

• Handle data in compliance with privacy law.

Overbroad content licences or vague consent provisions may expose organisers to further legal scrutiny.

Practical Compliance Checklist

Before launching any competition or award:

✔ Define eligibility clearly

✔ Match advertising with the actual rules

✔ Screen for geographic and sanctions risk

✔ Document judging and selection processes

✔ Draft precise terms and conditions

✔ Respect privacy and consent requirements

Appendix: Practical Case Example — Applying the Principles in Practice

Anonymised Case Example

A sporting goods company launches an annual international youth development award. The promotion is designed to recognise dedication, horsemanship, and community involvement among young athletes aged 12–21.

The award offers:

• A monetary scholarship component

• Equipment and merchandise

• Public recognition and promotional features

The campaign is advertised online and on social media as a “global” opportunity, encouraging entries from young participants around the world. Applicants are asked to submit a short video and photographs describing their journey in the sport.

The published terms and conditions clearly specify age eligibility, entry deadlines, judging criteria, and prize descriptions. However, the terms do not clearly specify geographic eligibility, nor do they identify jurisdictions where the organiser may be unable to deliver financial prizes or goods due to shipping restrictions, banking limitations, or international sanctions.

Additionally, the terms grant the organiser broad, perpetual rights to use submitted photos and videos for marketing purposes. Many participants are minors.

How This Example Illustrates the Legal Principles

1. Consumer Protection & Misleading Conduct

Because the promotion is described as “global,” participants in all regions may reasonably believe they are eligible to win. If certain participants are later found to be unable to receive prizes due to legal or logistical restrictions, the initial representation may be considered misleading — even if no deception was intended.

This illustrates the importance of clear eligibility disclosures at the point of entry.

2. Geographic Eligibility & Transparency

The absence of clearly defined geographic restrictions creates uncertainty for entrants and increases regulatory risk. Transparency at the outset protects both participants and the organiser by aligning expectations with legal reality.

3. Competition Regulation & Fairness

In the example, the organiser describes the award as being decided by a judging panel, with winners selected based on broad and subjective concepts such as dedication, spirit, or community impact. However, no objective judging criteria or measurable standards are clearly defined.

This creates a significant legal risk.

Under Australian trade promotion and gaming regulation, a competition is only treated as a game of skill if the outcome is genuinely determined by skill assessed against identifiable criteria. If the selection process is vague, discretionary, or insufficiently documented, regulators may determine that the competition is, in substance, a game of chance.

If classified as a game of chance, the promotion may require:

• a government-issued permit,

• compliance with state lottery laws,

• additional record-keeping and reporting obligations,

• and strict regulatory oversight.

By failing to establish clear, objective selection criteria and documented judging methodology, the organiser risks:

• misclassification of the competition,

• operating an unlicensed lottery,

• regulatory penalties and enforcement action,

• and challenges to the legitimacy of the results.

This illustrates why competitions relying on judging panels must go beyond general statements of intent and provide concrete, auditable criteria that demonstrate genuine skill-based selection.

Examples of Clear and Auditable Judging Criteria

To qualify as a genuine skill-based competition, the judging process should assess entrants against defined, observable, and recordable criteria. The following are examples of criteria that regulators and courts generally regard as appropriate:

1. Technical Skill & Competence

Measured by:

• Demonstrated proficiency in the activity (e.g., riding technique, control, execution).

• Adherence to recognised safety standards.

• Complexity of demonstrated skills.

• Accuracy, consistency, and control during performance.

Audit method:

Score sheets completed by judges with numeric ratings and written comments.

2. Knowledge & Understanding

Measured by:

• Demonstrated understanding of rules, theory, or best practices.

• Explanation of decision-making processes in written or video submissions.

• Ability to identify and respond to challenges.

Audit method:

Predefined question framework with scoring rubric.

3. Improvement & Progression

Measured by:

• Evidence of growth over time.

• Before-and-after performance comparison.

• Clear milestones achieved.

Audit method:

Comparison records with timestamped submissions.

4. Quality of Submission

Measured by:

• Clarity and structure of presentation.

• Completeness of required materials.

• Adherence to submission guidelines.

• Professionalism and organisation.

Audit method:

Checklist-based compliance scoring.

5. Effort & Commitment

Measured by:

• Time invested in training or preparation.

• Consistency of engagement.

• Documentation of ongoing participation.

Audit method:

Activity logs, training records, reference statements.

6. Community Impact & Leadership

Measured by:

• Demonstrated positive contribution to others.

• Evidence of mentoring, volunteering, or leadership.

• Testimonials or third-party verification.

Audit method:

Supporting documents and written references assessed against rubric.

7. Creativity & Originality

Measured by:

• Novelty of approach or ideas.

• Problem-solving ingenuity.

• Unique contribution or perspective.

Audit method:

Predefined creativity scale with justification notes.

8. Overall Merit Score

Each category is assigned a weight (for example):

Category	Weight
Technical Skill	25%
Knowledge	15%
Improvement	15%
Submission Quality	10%
Effort & Commitment	15%
Community Impact	10%
Creativity	10%

Judges calculate a final score for each entrant using the same formula.

Audit method:

Preserved scoring sheets, calculations, and judge sign-off.

Why This Matters Legally

This structure:

• Demonstrates that skill, not chance, determines the outcome.

• Produces verifiable records if a regulator requests evidence.

• Protects the organiser from claims of unfairness, bias, or misrepresentation.

• Prevents the competition from being reclassified as an illegal lottery.

4. International Transfers & Sanctions Compliance

Because the award includes a monetary scholarship and is marketed internationally, the organiser may face restrictions when dealing with certain jurisdictions. Without screening processes or exclusion clauses, the organiser risks promising benefits they may not be legally permitted to deliver. Furthermore, the organiser may be in breach of international sanctions.

5. Privacy, Consent & Minors

The broad content usage rights granted in the terms, combined with a participant group that includes minors, heightens the importance of lawful consent, parental authorisation, and careful data handling.