Italian State Department Apparently Considers A New Approach For Prize Contests With User Generated Content

Author:Dr. Felix Hofer
Profession:Studio Legale Hofer Lösch Torricelli
 
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In Italy 'prize contests' fall into the category of sales promotions, governed by a special Regulation (i.e. Presidential Decree no. 430 of 2001) and subject to supervision and control of the Ministry for Economic Development. Such Regulation governs local promotional initiatives "... of any kind, when consisting in promises of premiums to the general public and aimed both, at promoting, within the territory of the State, awareness about products, services, companies, brands, logos or trademarks as well as sales of certain products or supply of services, ...". It also sets a list of exemptions with respect to certain initiatives not subject to the legal and administrative requirements usually applying to sales promotions.

Among other cases (e.g. when prizes awarded consist in items of minimum value, i.e. gadgets such as a flag, a key ring, a pocket calendar, etc.), this exemption list refers also to "...contests announced for the production of literary, artistic or scientific works, as well as for the presentation of projects or studies in the areas of commerce or industry, where prize awarding to the author of the selected project is meant to reward the service or work performed or to acknowledge personal merits achieved or to result in an encouragement in community's collective interests ...".

In the past, the State Department used to take the view that promotional initiatives consisting in 'contests', based on participants skills (e.g. in preparing and submitting a story, a video or other materials, commonly known as 'user generated content') had to be considered as 'ordinary promotions', subject to all the legal and administrative requirements set in Presidential Decree no. 403 of 2001.

Recently the State Department's offices seem to have changed their mind on this specific aspect. In a memorandum, published a few weeks back, they have signaled a new approach to the advertising and marketing industry. The State Department reminds that already in the past 'prize contests' requiring participants to submit content created on their own in order to achieve a chance of winning a prize resulted covered by the exemption on condition that:

No purchase was required for participating to the contest, Prizes assigned to winners were intended to reward "the service or work performed or to acknowledge personal merits achieved or to result in an encouragement in community's collective interests ..." (as to the latter case, the memorandum cites...

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