Laura Fannin, Partner at Hayes Solicitors, is a key adviser to both brands and advertising agencies on
marketing and advertising issues. Laura advises clients in relation to all
areas of marketing and advertising law, including data protection and e-privacy
issues, consumer law, the drafting and negotiation of agency contracts,
promotional terms and conditions, sponsorship agreements and licence
agreements. She also advises on high value promotional campaigns prize draws
and has particular experience in the area of lotteries. She shares her expertise on running a prize promotion in Ireland.
that has thought about carrying out a prize promotion in Ireland will have most
likely come across the outdated Gaming and Lotteries Act 1956. Under this
legislation any prize promotion, which involves an element of chance in
selecting the winner, will most likely fall within the definition of a lottery
under the 1956 Act. Under the act, lotteries are illegal unless they are run
under a lottery licence.
this aspect of the 1956 Act is not currently meaningfully enforced in Ireland
in relation to marketing promotions, many brands do look to obtain a lottery
licence for Irish promotions, to avoid any risk of prosecution. The process for
obtaining a lottery licence requires a Court application and can add to the
expense of running a promotion in Ireland.
the criteria under the 1956 Act for obtaining a lottery licence is that the promotion
must be for a charitable or philanthropic purpose. Accordingly a practice emerged in recent years
for brands to partner with a charity who would obtain the licence. The licence
would then be used by the brand for marketing purposes and a donation would be
made to the charity for their involvement.
Government, however, is currently updating this legislation as part of a reform
of gaming practices in Ireland. In March
this year the Gaming and Lotteries
(Amendment) Bill 2019 was published, which provides for significant
amendments to lotteries.
important to note that this Bill has not yet been passed in law, so the current
1956 Act still applies. The Bill was, however, very recently debated before the
Irish houses of parliament and it is anticipated that the Bill will be
finalised and become law later this year.
for the first time introduces provisions directly relating to marketing
promotions. It provides that a licence
or permit is not required where a lottery is held in conjunction with the
selling or marketing of a particular product or service. There are, however,
two potential issues for brands running marketing promotions where prizes are
being distributed. Firstly, there is a
requirement that there has to be no charge for taking part in a lottery other
than the purchase of the product. This could potentially be problematic where,
for example, promotions require the entrant to make a phone call or send a text
message. It is unclear if the cost of the text or the call would be considered
to be “an additional charge”. Secondly, the Bill requires the total value of
the prizes for the promotions to be not more than €2,500. Given that this limit applies to the total
value of the prizes, it is likely that the majority of marketing promotions
would not be in a position to avail of this exception.
promotion cannot fulfil the requirements for the exemption for marketing
promotions, then there is now a new option under the Bill for the promoter to
apply for a permit. This permit can last for one year, and the total prizes in
any one lottery cannot exceed €5,000 or if there is more than one lottery in
any one week, the total value shall not be more than €5,000. There will be a
fee for applying for the permit, the amount of which has not been set. Also
permits will need to be applied for 60 days in advance of the promotion starting.
prize values are above the €5000 limit, described above, the only option open
to a promoter is to apply for a lottery licence. The Bill allows a prize limit
of €30,000 where a lottery licence is applied for. The new requirements set out
in the Bill appear, however, to prevent the current practice of brands applying
for lottery licences in conjunction with a charity.
provides that you cannot promote a lottery unless you hold the lottery licence
or you are an employee or agent of the licence holder. In order to continue with the current
practice of partnering with a charity, the brand would have to demonstrate that
they are an agent of the charity. It appears unlikely that a Court would find
that a brand is an agent of the charity in these circumstances.
applying for a lottery licence is no longer an option for marketing promotions,
which fall within the definition of a lottery, promoters will be confined (under
the current draft of the bill) to giving away prizes of no more than €5000 in
will be debated by the Irish parliament prior to the enactment and amendments
may be made that are favourable to brands and marketing agencies.
been involved in making submissions to the Irish Government on behalf of members
of the Irish promotional marketing industry. These submissions urged the
government to increase the prize pool limit; however there is no guarantee that
they will do so.
IPM Members can hear
Laura discuss the compliance landscape in Ireland – and ask her questions
live – by joining our Legal Briefing Webinar on Tuesday 15th
October at 1pm. More information and sign up here: https://www.theipm.org.uk/Events/October-2019/Legal-Briefing-Webinar.aspx
If you would like further information or guidance, get in touch with Laura
Fannin at firstname.lastname@example.org