Hungary regulator fines real estate lottery organiser £70k

The regulator warned that such activities, where real estate or cars were given away as part of a lottery, are considered games of chance and that neither private individuals or business associations can legally organise these games in any way

The STFHZ emphasised that the law states that a game of chance is any game in which the player becomes entitled to a monetary or other prize in exchange for the payment of money, where the winning or losing depends solely or predominantly on chance.

The authority made clear that loopholes – such as the ticket to participate being given as the real purpose of a product purchase like a book or t-shirt – were not valid excuses of getting around the law and these games would still be considered unlicensed lottery organising.

Disguised games of chance

The regulator said it was aware of “telling” signs these ventures were disguised games of chance, such as players receiving their money back if the draw does not go ahead, or if the price of the product is higher than would be considered normal.

Another sign that these enterprises are games of chance is that the lottery is only held if a certain number of products are sold. The STFHZ said that conditions do not occur with real promotions. The authority also said that the participation of a notary does not make this kind of lottery legal.

“The SZTFH strictly sanctions the organisation of such lotteries and may impose administrative fines of HUF500,000 to HUF100 million on the organiser,” said the regulator.

“This activity can also serve as the basis for criminal prosecution, because anyone who regularly organises illegal gambling is punishable by up to three years in prison for a crime.

“In the case of an advertisement promoting unlicensed gambling, the advertiser, the advertising service provider, the publisher of the advertisement and the person featured in the advertisement may be jointly fined at least HUF10 million.

“In unlicensed gambling, the player participates at his own risk, the authority does not have the authority to enforce the handing over of prizes and the enforceability of claims in court is also doubtful.”