How will the new Code of Conduct impact your prize competition business?

Why has the DCMS introduced a new Code?

The Department for Culture, Media and Sport (DCMS) has introduced a new voluntary Code of Good Practice for all prize competitions, prize draws and prize promotion businesses and has now published the final version of this. This is because at present most of these types of businesses offer exemptions such as a free entry route, therefore falling outside of the scope of regulation by the Gambling Commission and under the Gambling Act 2005.

Is the Code mandatory?

Whilst this is voluntary, it is highly recommended that businesses sign up and adhere to this.

The growing prize competition market

The explosion of prize draws, and prize competitions has meant that the current UK market is worth over £1.3 million according to recent statistics.

Purpose of the Code

The new Code of Good Practice is the DCMS’ attempt at trying to reduce the risk of harm to entrants to these prize competitions and prize draws, by introducing measures that prize competition and prize draw businesses should follow, if they agree to sign up to the new Code of Good Practice. It also is to avoid further regulations being introduced in the future, although the Government remains silent on this at present.

This blog explores the potential impact of the new Code of Good Practice on businesses, focusing on the legal obligations and practical implications for promoters. It does not replace existing regulations and requirements including data protection laws, consumer protections, advertising codes. These all remain integral to the compliance of a prize competition or prize draw operator.

Implementation period

Businesses have 6 months from signing the new Code of Good Practice to implement any changes and in any event no later than 28 May 2026.

What are the changes and how will they impact your business?

1. Player protections

• Operators should restrict entries to those over 18 using a tick box and verification process
• Provide a robust complaints process
• Remove or limit credit card payments to £250 per player and no credit card payments should be accepted for instant wins
• Set proportionate monthly spend limits
• Implement suspension options and for a period of 6 months of more
• Signposting of services for support and risk of harm
• Maintain appropriate periods between opening and closing times for such competitions and draws

2. Transparency

• Ensure that prize competitions and draws are awarded fairly through a verifiable process and in accordance with the rules and terms displayed
• Ensure that all free entry options are displayed prominently and brought to the attention of the entrant
• Promptly deliver prizes
• Outline any charity partners / processes and parameters

3. Accountability

• Businesses will agree to monitor and adhere to the new Code of Good Practice
• Businesses are encouraged to have their processes and systems regularly monitored to ensure compliance
• Ensure their websites publish all measures in place
  Work collaboratively with the DCMS to maintain compliance

Summary

As outlined above, the new Code of Good Practice is designed to ensure transparency and to provide a series of guidelines for businesses operating in this sector. Whilst not legally binding, it is clear the DCMS expects businesses to adhere to this and use the framework in a positive way to strengthen the integrity of the industry.

How does this impact your business and what do you need to do?

Early adoption of this code will give businesses a competitive advantage and most businesses had already begun to implement most of the recommendations in any event, so the changes have not come as a huge surprise to the industry.

Recommended actions

• Have your terms and conditions, privacy policy and other documents reviewed and updated. Ensure that your route to entry and exemption under the Gambling Act 2005 is also clearly defined.
• Contact your web developer and conduct a review with them over your operational framework and what changes need to be made to your website to implement the recommendations in the Code of Good Practice.
• Develop internal policies and procedures for identifying risks of harm and signposting strategies
• Ensure that your legal opinion letters are obtained at regular intervals such as 6 monthly periods, so you can maintain a clear portfolio of evidence of compliance.
• Communicate any changes to your customers. Be clear, honest and transparent!
• Ensure you are able to offer a clear route of exemption in your prize competition or prize draw. We are aware that the Gambling Commission for example are focused on businesses purporting to offer skill-based competitions which are more chance based than skill, and therefore these are likely to be found to be non-compliant.

Final thoughts

As highlighted above, the proposed Code of Good Practice represents a significant shift in the regulation of prize competitions, with a focus on transparency, fairness, and harm reduction. Businesses operating in this sector will need to adapt their practices to comply with the new requirements, including providing clear information about competition mechanics, ensuring impartial judging, and implementing robust compliance measures.

While these changes may pose challenges, they also offer an opportunity for businesses to enhance their reputation and build trust with participants by demonstrating a commitment to ethical and transparent practices. By proactively addressing these requirements, businesses can mitigate risks and position themselves as leaders in the evolving regulatory landscape of prize competitions.

How can Ellis Jones help?

Our expert legal team can guide you through the new Code of Good Practice, review your terms and processes, and help implement changes seamlessly. Get in touch with us today for tailored advice and practical support.