It’s a Small World: Navigating a Global Sweepstakes

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It's a world of laughter
A world of tears
It's a world of hopes
And a world of fears
There's so much that we share
That it's time we're aware
It's a small world after all.

It’s a Small World by Robert B. Sherman and Richard M. Sherman

You don’t have to go to Disney World and take a 10-minute boat ride down the Seven Seas Waterway to realize that people around the globe are interconnected in so many ways and that a company’s business is pretty much global. So why can’t a brand run a worldwide promotion? You can, but not without navigating through bumpy waters.

Getting on the Boat – Eligibility

Establishing a firm list of countries to void is like trying to identify the nationality of everyone getting on the ride. A list of countries to void could include: Afghanistan, Australia, Belgium, Belize, Bolivia, the province of Quebec (Canada), Cambodia, Chad, China, Colombia, Cuba, Germany, India, Iran, Iraq, Italy, Lebanon, Libya, Myanmar, North Korea, Pakistan, Singapore, Somalia, Spain, Sweden, Sudan, Syria, Tanzania, Thailand, and Turkey – or more, depending on who you ask.

Then you can’t forget the catchalls: “countries subject to U.S. export control restrictions and sanctions,” “countries embargoed by the U.S.” and “countries that have been designated by the U.S. government as ‘terrorist supporting’ nations.”

And to avoid any unwanted trouble, it would be best to limit entrants to those who have reached the age of majority. The age of majority is often 18 years in most countries. But there are some notable exceptions, such as Japan (20), New Zealand (20), and Indonesia (15). In Canada, some provinces are 18 while others are 19. And even in the U.S., there is no standard age of majority because in Alabama and Nebraska it’s 18 and in Mississippi it’s 21.

Buckling Up – Registration

Some countries just simply have too many restrictions to justify including them in a worldwide sweepstakes. For example, a number have strict licensing, registration, or bonding requirements: Quebec (Canada), France, Brazil, Czech Republic, Austria, Hong Kong and the Philippines. And Australia has different registration requirements depending on the State or Territory.

Other countries are impractical because they require the drawing to be held locally for local citizens, such as Italy and Spain.

Following the Instructions – Translation

Just like the ride, your rules and ads may need to accommodate the different languages of your participants. The following countries have laws requiring translation of promotional materials: Canada (Quebec), Germany, France, Italy, and Spain, and it is highly recommended in Japan and the Netherlands.

Facing the Glockenspiel – Timing

We all know from staying up in the middle of the night to watch the Olympics across the seas that today could be tomorrow in another part of the world. Therefore, be very clear with the start dates and times, such as “12:01 am Eastern (US) Daylight Time on 6/15/2022.”

Starting Down the Rapids – Method of Entry

Purchases are generally prohibited everywhere as the sole entry method. But even some countries may prohibit any paying method of entry. For example, in Ireland, if a substantial number of entries come from product purchases, even when an AMOE is available, your sweepstakes could be considered illegal.

The Internet is typically the go-to AMOE, but you may need to consider whether any particular country would consider this a “paying “method of entry, especially, if the Internet is not so widely available in that country. For example, I’ve heard that Internet accessibility is blocked by the government in Vietnam, and countries such as Pakistan, Nigeria and Bangladesh may have over 100 million residents without Internet access.

What about mail-in entries? We know that in the U.S. mail-in entries are acceptable as “free” entries, but the cost of international postage could turn your sweepstakes into an illegal lottery in other countries. For example, in Australia, standard postage is ok up to 55 cents, while in Norway any payment above 20 cents is prohibited. In France, entrants are entitled to re-coup from the Sponsor the cost of postage – which could add up if you expect un grand nombre de parisiens to participate.

Seeing the Spinning Singing Dolls – Prizes

Some countries have monetary limits on prizes: For example, in the Netherlands, prize pools over 100,000 euros are prohibited as are individual prizes of over 2,500 euros, and in Mexico, any prize over $5,000 must be delivered to the winner in the presence of Mexican authorities.

And of course, there are a number of quirky country-specific prize prohibitions, including: Australia (no cosmetic surgery); Colombia (no $ unless Sponsor is a financial institution); Finland and Norway (no living animals [apparently dead ones are ok]); New Zealand (no commercial sexual services – I kid you not); Thailand (no cash prizes); and UAE (no pork products).

Finding the Mary Blair Doll -- Validation

Rumor has it that one doll in the It’s A Small World attraction looks like the ride’s designer, Mary Blair. When you find her, you’re going to want to validate her authenticity, but validation in international sweeps will likely cost you time and effort. So, it would be a good idea to limit the number of prizes and ask your accountant how to handle prizes over $600 – which require IRS reporting and a W-9 form to the winner in the US. And don’t forget the Sponsor may be liable for taxes on the prize in Argentina, Austria, Spain and Portugal.

Using those Pics of the Children Around the World – Privacy Issues

Prize promotions require the collection and use of personal information, such as name, address, age, etc. Collection of information in the EU is subject to the General Data Protection Regulation (GDRP). In addition, some countries may impose limits on any waiver or transfer of rights, including Intellectual Property and Third-Party Rights; for example, maintaining publicity rights in perpetuity in Russia is not allowed.

Entering the Goodbye Room – Dispute Resolution

We all love when we get to the end of the ride and see the myriad ways Goodbye is expressed throughout the world. But because goodbye may not mean it’s over at the end of a sweepstakes, Official Rules typically include a clause for dispute resolution, including a choice of law and a choice of forum, which may include binding arbitration. While these clauses are generally upheld under U.S. law, it cannot be guaranteed that a dissatisfied entrant or winner in a foreign country won’t try to haul you into court in their home forum, and it can’t be guaranteed that that foreign court won’t ignore the forum selection and law selection clauses in your Official Rules.

The bottom line is that companies considering a global sweepstakes can’t simply add “VOID WHERE PROHIBITED” to the Official Rules and hope to have an effortless cruise. When dealing with international sweepstakes, remember Walt Disney’s adage, The (Cruella) de Vil is in the details.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Verrill | Attorney Advertising

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