Introduction
For any Australian not-for-profit or charitable organisation, conducting a giveaway or competition can be a highly effective fundraising tool. However, navigating the complex web of state and territory regulations is essential, as non-compliance can lead to significant legal repercussions and damage to a charity’s reputation.
This guide provides essential information for any not-for-profit organisation looking to conduct a compliant charitable giveaway, outlining the critical compliance requirements across Australia. It will also explore the challenges posed by inconsistent state-based laws and the ongoing push for a national harmonisation model to simplify the regulatory process for fundraising.
Understanding Charitable Raffles
Distinguishing Raffles, Lotteries & Competitions
In the Australian regulatory landscape, it is important for a not-for-profit organisation to understand the differences between various fundraising promotions. A raffle is a type of lottery where participants buy tickets for a chance to win a prize, with the winner being selected through a random draw. Because the outcome is determined purely by chance, a raffle is legally classified as a form of lottery.
Lotteries are generally defined as games of chance that require:
- Participants to provide payment (such as purchasing a ticket)
- Eligibility to win based on random selection
This element of chance is what distinguishes lotteries from skill-based competitions. In a competition based on skill, the winner is chosen based on merit, talent, or judgement—for instance, by answering a question correctly or submitting the most creative entry—rather than by a random selection process.
Who Can Legally Conduct a Charity Fundraising Raffle
The authority to conduct a charitable raffle in Australia is specifically reserved for certain types of organisations. Generally, only registered not-for-profit organisations and charities are legally permitted to run raffles for fundraising purposes. The primary objective must be to raise funds for an approved charitable purpose, such as:
- Advancing education
- Improving health
- Supporting social welfare
For-profit businesses, on the other hand, are not permitted to conduct traditional raffles where tickets are sold to generate profit. Instead, if a business wishes to run a giveaway to promote its products or services, it must structure the event as a trade promotion lottery. In a trade promotion, entry must be free or conditional on a purchase, but it cannot involve the standalone sale of a ticket for a chance to win.
The Regulatory Framework for Your Charity Giveaway
The Primary Role of State & Territory Governments
In Australia, the regulation of fundraising and gaming activities, such as charitable raffles, falls under the jurisdiction of state and territory governments. The Australian Charities and Not-for-profits Commission (ACNC) does not oversee these activities.
This decentralised approach creates a complex and often inconsistent regulatory landscape for not-for-profit organisations. Each state and territory has its own unique set of laws and requirements for conducting a charity giveaway, with rules governing:
- Competition structure
- Permit requirements
- Necessary documentation
Consequently, any charity planning a fundraising raffle must carefully research and adhere to the specific laws of the state or territory in which the competition is being conducted.
Key Compliance Obligations Under ACL
Alongside state-based regulations, all charitable competitions must comply with the federal Australian Consumer Law (ACL). This law is designed to protect consumers and ensure fairness in trade and commerce, which extends to fundraising giveaways.
The ACL prohibits any conduct that is misleading or deceptive, or is likely to mislead or deceive participants. Several key obligations under the ACL apply directly to a not-for-profit giveaway:
| Obligation | Description |
|---|---|
| Accurate Representation | The prize advertised must accurately represent the prize that will be awarded. For instance, you cannot promote a new car and award an older, different model. |
| Intention to Provide the Prize | It is an offence to offer a prize with no intention of providing it. A charity cannot cancel a competition simply due to a low number of entries once it has been advertised. |
| Prohibition of Unfair Practices | The ACL forbids unfair practices, such as falsely representing the chances of winning, failing to award a prize as promised, or imposing unreasonable conditions on claiming a prize. |
Request a Free Consultation with one of our experienced Lawyers today.
Get Your Free Initial Consultation
State-Specific Permits & Licences for a Charity Competition
An Overview of Permit Thresholds Across Australia
The requirement for a not-for-profit organisation to obtain a permit or licence for a charitable competition depends on the state or territory where the giveaway is conducted. These regulatory obligations are typically triggered when the total value of prizes or tickets sold exceeds a specific threshold, which varies significantly across Australia.
A permit may be required for your charity fundraising competition under the following conditions:
| State / Territory | Permit Threshold / Condition |
|---|---|
| New South Wales | An authority is needed if the total prize value is over $30,000. |
| Victoria | A permit is required when the total value of ticket sales exceeds $20,000. |
| Queensland | A licence is necessary for games with gross proceeds of more than $50,000. |
| Western Australia | A permit is mandatory if the total ticket value is greater than $2,000. |
| South Australia | A licence is required for major lotteries where the prize value exceeds $5,000. |
| Tasmania | A permit is needed for raffles with a prize value of more than $5,000. |
| Australian Capital Territory | A permit is generally required, though an exception exists for not-for-profits if the prize value is under $500. |
| Northern Territory | A permit is necessary when the total value of tickets for sale is more than $5,000. |
It is important to remember that even if a permit is not required for a smaller Australian charity giveaway, other compliance rules may still apply. For instance, in New South Wales, raffles with prizes under the $30,000 threshold must still adhere to conditions regarding record-keeping and prize distribution.
Managing Online & Cross-Border Fundraising Compliance
Conducting an online charitable competition that accepts entries from multiple Australian states introduces significant regulatory complexity. If your not-for-profit organisation sells tickets across state boundaries, you must ensure compliance with the fundraising and gaming laws in every jurisdiction where the giveaway is offered.
Determining which state’s laws apply can be challenging, especially for an online platform. Key factors that regulators consider include:
- The location of the organisation’s head office and its ticketing and drawing systems.
- Whether promotions and advertisements are specifically directed at residents of a particular state.
- The eligibility of residents from a specific state or territory to purchase tickets and win prizes.
- Who is responsible for the costs associated with transferring or delivering a prize across state borders.
Given these complexities, any organisation planning to conduct a cross-border or national fundraising competition should seek legal advice. This ensures that the charity meets all relevant permit and compliance obligations, minimising legal and reputational risks.
Request a Free Consultation with one of our experienced Lawyers today.
Get Your Free Initial Consultation
Essential Governance for Conducting a Compliant Giveaway
Drafting Clear Terms & Conditions for Your Competition
To ensure your not-for-profit giveaway is transparent and legally compliant, you must create clear and comprehensive terms and conditions. This document sets the rules for the competition, protects your organisation from disputes, and is a key legal requirement for any Australian charitable fundraising promotion.
Your terms and conditions should be written in plain, understandable language and be easily accessible to all participants. Key details that must be included are:
| Component | Description |
|---|---|
| Eligibility Criteria | Clearly define who is permitted to enter the competition, including any age or residency restrictions. |
| Entry Method | Outline the exact steps participants must follow to enter, the price of tickets, and any limits on the number of entries per person. |
| Competition Period | Specify the start and end dates and times for entry into the giveaway. |
| Prize Details | Provide a full description of the prize, its total value, and any conditions or restrictions on its use. |
| Winner Selection | Explain the method for drawing the winner, including the date, time, and location of the draw, and how winners will be notified. |
| Privacy Information | Detail how your charity will collect, use, and store participants’ personal information, and link to your organisation’s privacy policy. |
| Permit Numbers | If a permit or licence is required for your competition, the number must be displayed in the terms and conditions. |
| Unclaimed Prize Procedure | Outline the process for handling a prize if it is not claimed by the winner within a specified timeframe. |
Meeting Your Record Keeping & Reporting Obligations
A critical aspect of good governance for any charitable competition is maintaining meticulous records. State and territory regulations require your not-for-profit organisation to keep detailed documentation of all fundraising activities, which is often a condition of holding a permit.
These obligations ensure transparency and accountability, demonstrating that funds are managed correctly and prizes are distributed fairly.
Your charity must keep accurate records of:
- All ticket sales and the total funds raised
- Any administrative expenses associated with running the giveaway
- The distribution of prizes to the winners
These financial records must be retained for a specific period as mandated by local laws, which can be up to seven years. Proper record-keeping not only ensures compliance but also builds trust with your donors and the wider community.
100% Obligation-Free
Speak to one of our Experienced Lawyers Today
Conclusion
Conducting a compliant charitable giveaway in Australia requires a not-for-profit organisation to navigate a complex landscape of state-specific regulations, from securing the correct permits to establishing clear governance. Understanding these legal duties and the ongoing push for national harmonisation is essential for any Australian charity planning a successful fundraising competition.
For expert assistance with your fundraising compliance, contact the not-for-profit lawyers at LawBridge. Our team provides the trusted expertise needed to manage your charitable competition effectively, ensuring your organisation’s efforts are both successful and legally sound.
