New Law Gets Tough on Incentive Lotteries.

12.08.2010

Legal Update No. 166.

Goltsblat BLP advises that Federal Law 214-FZ dated 27 July 2010 "On Amendments to the Federal Law ‘On Lotteries’” came into effect on 10 August 2010.

Among other amendments, the new law imposes limitations on incentive lotteries.  These are a form of lottery requiring no entry fees and with a prize fund put up by the lottery organisers.

The new law prohibits using mechanical, electrical, electronic or other technical devices to determine awards, prizes and/or gifts, whether in cash or in kind, in incentive lotteries. The terms of an incentive lottery may not, therefore, allow players to use mechanical, electrical, electronic or other technical devices to determine and/or receive prizes, awards and/or gifts. Moreover, no lottery equipment can be used in incentive lotteries.
The law introduces strict requirements on lottery equipment, including technical rules, mandatory confirmation of compliance by lottery equipment with the lottery rules and obligatory registration of the lottery equipment with the Unified State Register of Lottery Equipment, to be maintained by the federal executive body authorised by the Russian Government.

These amendments actually mean that the Internet, PCs or any other such devices cannot be used to determine the winners in incentive lotteries. As a result, authorised bodies are expected to ban such incentive lotteries when they receive notification of them.

If the authorised bodies were notified of an incentive lotteries before 10 August 2010 (when the amendments became effective), the organisers of such lotteries have the right to hold them up to and including 31 December 2010.

It is also worth noting that a number of amendments have been drafted further limiting incentive lotteries, up to and including a total ban on them. If these amendments are passed when considered by the State Duma during the 2010 autumn session, the legal framework for incentive lotteries might become even tighter.

For additional information, please contact:

Ekaterina Tilling,
Partner,
Intellectual Property,
Goltsblat BLP,
T: +7 (495) 287 44 44,
E: info@gblplaw.com

Irina Chubukova,
Associate,
Intellectual Property,
Goltsblat BLP, 
T: +7 (495) 287 44 44,
E: info@gblplaw.com

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