What is the difference between free draws and prize competitions?

Most competitions in the UK fall under the two types of competitions: free draws and prize competitions. This has very little to do with anything else, other than avoiding being regulated by the more stringent gambling rules and having to hold a gambling license, like genuine betting and gambling companies have to.

While some competitions do adhere to the rules and are therefore perfectly legal; unfortunately the majority of the competitions in the UK currently are at best ‘barely legal’. This also means that there is an utter lack of requirement for any sort of compliance and enforcing these rules, since free draws and prize competitions do not fall under the Gambling Commission’s control. The unfortunate result from this is that there are several competitions being run in the UK that you should most definitely steer clear of. This is why it’s important to identify how according the guidelines a competition is run, and also whether the competition (or draw) adheres to these rules, as if the competition does not, it’s very likely that they’re doing something else that could be considered dishonest.

Free Draws

As far as the Gambling Commission is concerned, there are two types of free draws: Ones, where all entries are free, and free draws where there is also a paid entry route. The latter is the most common one, as the competitions are trying to raise money for the prizes (and to make a profit).

However, the Gambling Commission is very clear that if you run a free draw with a paid entry route, the following must apply, that in reality never do.

1. The free entry route can be no more expensive and must be no less convenient than the paid route

Most common use of free entry mechanism is by using a postal entry. But, we’d argue that by definition having to get an envelope, writing your details down, getting a stamp, taking the letter to the post(box), etc… Is already inherently less convenient than a paid route would be, where you just add a ticket to your basket and use the website to checkout. Also, as some of the ticket prices are quite low (or at least lower than the cost of a single stamp), using postal entry for the free route doesn’t exactly adhere to the guideline.

2. The free entry route must be promoted and displayed at the same level as the paid for routes

Sometimes the competition websites have just one obvious link or a big button for adding your tickets to your basket, and the “Free Entry” link is either hidden somewhere in the footer of the website, or further down on the page. Or even worse, we’ve seen some competitions hide the free entry route to a separate terms and conditions page, which is also a clear violation of the guidelines.

3. The choice between the free entry route and the paid entry route must be promoted so that people who want to participate can see it

But even if the free entry route is ‘promoted at the same level’, they are without fail done in a way that is less prominent (e.g. a text link with a faded colour vs. a bright big button). Therefore, you could argue that such competitions are once again not complying to the guidelines.

4. The system that determines prizes should not recognise the two routes as different

Even though the systems shouldn’t discriminate between free postal entries (the most common free entry method) and the paid ones, the potential postal entries are quite probably hardly (if ever) taken into account in the draws as this would require lots of manual work. And even if a competition would claim that they are performing the draws accordingly and taking into account all free postal entries, you can ask yourself: Is it in the competition’s interest to award the win to a paying customer, or a customer who causes extra manual work and doesn’t bring in any money?

Addionally, there are a number of issues with ‘free entry methods’, unless they’re implemented with the same system as the paid ones are. For example, if you have a competition that is running a limited number of tickets and the draw is automatically performed, will a ‘free postal entry’ ever get picked? Probably not. Especially, if time remaining in the competition is limited; you can expect that your postal entry wouldn’t even be physically be able to taken into the draw before it’s performed. Or what if you are entering a competition with a limited amount of tickets, and there are a number of instant win tickets (and no end prize)? Surely the instant win tickets are assigned to actual ticket numbers, and not to the potential incoming odd few envelopes?

So… What’s the point? Realistically, it can be expected that a lot of the free entries won’t make the final cut. Which also begs the question: Is it worth entering the competitions via free entry methods in the first place?

So, how does a compliant Free Draw competition look like?

While the mechanism of a free postal entry method is still quite inconvenient and it’s debatable whether it’s fully compliant, the best example of a free draw with a paid entry route is unsurprisingly by BOTB. You can see the link for the free entry mechanism is in the same style, in the same level, right next to the main tab of the popup.

Prize Competitions

Prize competitions are the second most common form of a competition. Or as they most commonly appear to be in practice; a prize draw with a very simple question that gets asked prior to entering. According to the Gambling Commission the outcome should be determined by the participants skill, judgement or knowledge. They also say that multiple choice questions do not fit this criteria, which is in effect how bulk of the competitions are being run in the UK.

Some companies at least make an effort with their multiple choice questions, and change these every time their competition changes. 7 Days Performance is a good example of this. Some competitions on the other hand are trying less hard, and are being very obvious that the question is just there as a tick-box exercise to avoid being regulated and having to go through the hoops and loops of compliance. As an example, a couple of the major UK competitions have had the same question for years: What is the capital of England? This probably doesn’t make a massive difference to you as a player, but it’s good to bear in mind that the rules, regulations and guidelines are there for a reason – and whether a business adheres to the rules can be quite telling of the operation itself.

So once again, the vast majority of the competitions are not compliant to the guidelines. The best example of a compliant prize competition is BOTB’s spot the ball, as spot the ball is genuinely a game of skill, and therefore compliant with the guidelines.

Conclusion

As it’s extremely obvious that the bulk of the competitions are just set up in a way to avoid regulatory compliance, it also brings up the question… Why should you care? We’re not necessarily saying you should, but at the very least you can use the legality of the competitions (which is also a part of our Real Score) as an indicator whether you potentially should be parting with your hard-earned money or not.

While the Gambling Commission doesn’t seem to currently care about the hundreds of competitions in the UK that are at least partially breaking the guidelines and therefore should hold a license for running the competitions, there might come a day when they (or another regulatory body) suddenly will clamp down on all the competitions. And this can mean anything from the competitions having to change a few minor things on their website, having to introduce more complicated entry mechanisms, all the way to be suddenly shut down. And you could be unlucky enough to have just played a competition that gets shut down without any way of getting your money back…

Food for thought!

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