CANADA
Canadian coffee giant Tim Hortons runs a sweepstakes contest called “Roll Up the Rim” that runs from early March to early April each year. Roll up the Rim is ingrained in Canadian popular culture, and Tim Hortons gives away tens of millions of dollars in prizes each year. Roll Up the Rim is now all digital, so future generations will not experience rolling up the waxy rim of a Tim Hortons disposable coffee cup with their teeth to reveal the “Please Play Again” message. All coffee cup rolls are now virtual and carried out through a customer’s Tim Hortons phone application. Roll Up the Rim is free to enter because drinks are the same price irrespective of whether the Roll Up the Rim contest is running or not. Sweepstakes contests also require free entries to be made available to participants without them making a purchase. Anyone can obtain Roll Up the Rim entries for free by following instructions provided in the contest rules. A uniquely Canadian sweepstakes contest law wrinkle is that prizes cannot be awarded on the basis of pure chance. Contestants must therefore answer a skill testing question prior to rolling up their first digital rim. Roll Up the Rim meets the legal tests 3 and common-sense definitions of a sweepstakes contest. As is typically the case with quasi-gaming activities, savvy entrepreneurs have found creative ways to run sweepstakes focused businesses that push the legal tests and our common-sense understanding of sweepstakes contests with varying degrees of legal success. Federal law related to sweepstakes contests The primary Federal law sources for Canadian sweepstakes contest laws are the Criminal Code 4 and the Competition Act . 5 In addition to the gambling prohibitions in the Code, there are two additional factors arising from the Code which sweepstakes contest operators should consider.
First, s. 206(1)(a)-(c) of the Code creates various offences for “disposing of any property by…any mode of chance”. 6 As a result, one of the unique features of Canadian contest law is that prizes cannot be awarded based on pure chance. Therefore, some game or activity must occur which has some element of skill prior to prizes being awarded. This typically manifests as a math-based question which participants must answer correctly prior to receiving their prize and is known colloquially as the “skill-testing question” requirement. Second, s. 206(1)(f) of the Code creates an offence for “disposing of any goods, wares or merchandise by any game of chance or mixed chance and skill in which the contestant or competitor pays money or other valuable consideration”. 7 This section has been interpreted as prohibiting contests where the only way to enter the contest is to buy a product or service. Therefore, sweepstakes contest providers must offer free alternative methods of entry to demonstrate that individuals not purchasing an underlying product may still enter a contest. Finally, the Act , which is a civil provision, requires that sweepstakes contest promoters meet the following conditions: a. adequate and fair disclosure is made of the number and approximate value of the prizes, of the area or areas to which they relate and of any fact within the knowledge of the person that affects materially the chances of winning; b. distribution of the prizes is not unduly delayed; and c. selection of participants or distribution of prizes is made on the basis of skill or on a random basis in any area to which prizes have been allocated. 8 Provincial law related to sweepstakes contests Quebec is the only province in Canada that had legislation specific to sweepstakes-type contests. 9 As a result of this
3 A discussion of what is an appropriate skill testing question is outside the scope of this paper and almost certainly academic given the popular- ity of Roll Up the Rim as well as other sweepstakes contests provided by global brands and the lack of concern expressed by Canadian authorities about the appropriateness of the skill-testing question 4 R.S.C., 1985 c. C-46. [hereinafter, the “Code”] 5 R.S.C. 1985, c. C-34. [hereinafter, the “Act”] 6 Supra note 3, s. 206(1)(a)-(c) 7 Ibid at s. 206(1)(f) 8 Supra note 4 at s. 74.06 9 Act Respecting Lotteries, Publicity Contests and Amusement Machines, 1990, c. 46, s. 18. Available at http://www.legisquebec.gouv.qc.ca/en/
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IMGL MAGAZINE | JANUARY 2024
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