by：Viranpat Kitsuwanrat、Nanticha Boonjan
In conducting business, a sales promotion campaign that includes premium gifts or chances to win prizes is a widely popular method. Not only does it create excitement, but it also encourages consumers to make purchasing decisions. Sales promotion campaigns are regulated under the Gambling Act B.E. 2478 (1935) (the “Gambling Act”), which requires obtaining a license for conducting promotions involving premium gifts or prizes by chance (the “License”) before organizing any such activities. This article provides an overview of the legal requirements for organizing sales promotion campaigns involving such elements, which must be authorized under the law, as explained below.
Sales Promotion Campaigns Requiring Legal Authorization
Section 8 of the Gambling Act states: “Organizing premium gifts or prizes by taking a chance through any method in the course of business or a profession must be authorized by the licensing officer before it can be conducted.”
To determine whether a sales promotion campaign involving chance requires a License, the following three conditions must be met:
The organizer offers premium gifts or prizes;
A method of chance is used;
The activity occurs in the course of business or a profession.
“Premium gifts or prizes” refer to items or benefits offered by an organizer that exceed the amount customers pay for products or services. This includes free products given even without any purchase.
“Taking a chance” refers to any activity with uncertain outcomes that rely on unpredictable factors, determining whether a participant gains or loses benefits. This includes methods such as random selection, lucky draws, lotteries, or similar approaches, resulting in an unequal distribution of prizes among participants.
“In the course of business or a profession” refers to situations where a sales promotion campaign encourages consumers to purchase products or services or otherwise boosts sales to the extent that it influences purchasing decisions. These are likely to be viewed as commercial activities subject to regulation.
Interpretation Example: Sale of Mystery Boxes by the Department of Provincial Administration
The sale of mystery boxes—where buyers take a chance on what products they receive—involves combining multiple items in a single box, with the total value equal to or exceeding the purchase price. Any added value beyond the amount paid is considered a premium gift. Because this form of sale occurs as part of a business, and buyers are unaware of the exact items, premium gifts, or their values, it qualifies as taking a chance under Section 8 of the Gambling Act and requires authorization.
Approved Methods for Taking a Chance
The Gambling Act limits the methods of chance that may be authorized. Only two methods are permitted by the Ministry of Interior:
Submitting product labels, gift vouchers, or other entry cards to participate in a lottery draw held at the specified date, time, and location indicated in the License.
Sending an SMS, making a phone call, or using similar methods to enter a contest or opinion-based challenge, where participants’ phone numbers are drawn on the specified date, time, and location.
According to the Ministry’s directive, any other methods of taking a chance are not eligible for authorization.
For example, organizing sports prediction games—such as guessing football match outcomes or the first goal scorer—is prohibited. Even if customers participate in such prediction games for free via a mobile application, such activities are not permitted under the law.
Obtaining a License
Any sales promotion campaign involving a chance to win prizes must apply for a License from the Department of Provincial Administration, Ministry of Interior.
A violation of Section 8—organizing premium gifts or prizes by chance in the course of business or a profession without a License—is a criminal offense punishable by up to one year’s imprisonment, a fine of 50 to 2,000 baht, or both, under Section 14 of the Gambling Act.
Once the License is approved, organizers must strictly adhere to the approved conditions, including holding the event at the date, time, and location specified in the License, inviting government officials to observe the prize draw, ensuring transparency in the process.
Additional Legal Obligations
Organizers must also comply with other legal obligations such as ensuring that the goods are priced in accordance with the market rate, customers receive items worth at least the value they paid even if they do not win any prizes, displaying the License at the event location for the entire duration of the activity, reporting the names of winners who receive prizes, along with fulfilling any additional requirements as prescribed by the authorities.
Advertising Sales Promotion Campaigns Involving Chance
Many organizers promote their campaigns on platforms like Facebook, TikTok, and Instagram. However, such promotions must comply with the Ministerial Regulation on Advertisements of Goods or Services That Are Unfair to Consumers or May Cause Social Harm, B.E. 2564 (2021).
Advertisements must clearly include rules for participating, start and end dates, prize announcement dates, channels for announcing winners, event location, types, characteristics, and values of prizes.
Organizers must ensure that advertisements are not misleading and must state where consumers can find more information about the campaign.
Failure to comply may result in an offense under Section 22 paragraph two (5) of the Consumer Protection Act B.E. 2522 (1979), punishable by up to 3 months’ imprisonment, a fine of up to 30,000 baht, or both.
Moreover, organizers should manage legal risks associated with taking-a-chance activities, such as handling the personal data of prize winners in compliance with privacy laws, ensuring compliance if the promoted goods or services are subject to special regulations.
This article provides general guidance only. Each campaign may involve unique facts that require individual legal assessment. Therefore, it is strongly recommended to consult legal experts to determine the proper steps for organizing campaigns involving premium gifts or prizes by chance and to ensure full legal compliance—including obtaining the License. Doing so will help your promotion run smoothly and lawfully.
