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Can I offer contests that involve non-cash prizes in New Jersey? What are the requirements?

Yes, you can offer contests that involve non-cash prizes in New Jersey, provided that the winner or winners are selected solely on the quality of an entry in the contest as determined by a panel of judges using uniform criteria to assess the quality of entries. This type of contest is considered a “contest of skill” and is not considered unlawful gambling under New Jersey law [1.1].

Requirements for Contests of Skill

To qualify as a “contest of skill,” the outcome of the contest must not depend in a material degree upon an element of chance. The winner or winners must be selected solely on the quality of an entry in the contest as determined by a panel of judges using uniform criteria to assess the quality of entries [1.1].

Types of Prizes Permitted

Non-cash prizes that are permitted in New Jersey are limited. No licensee shall offer or give, directly or indirectly, any prize in any single amusement game except merchandise other than alcoholic beverages; drug or narcotic paraphernalia; obscene or indecent recordings, printings, writing, pictures, or other matter; weapons as defined in N.J.S.A. 2C:39-1r; or any live animals. The retail value of such merchandise prize or prizes to be offered or awarded in any game or for an accumulation of wins from a series of games or plays shall not exceed an average retail value of $10,000 [2.1][4.1].

Redemption of Prizes

No licensee shall redeem for money or for the playing of any additional game, any prize, ticket, or token or allow, permit, or participate in such redemption. Notwithstanding the above, a licensee may, at the conclusion of the game and at the player’s option, award an additional game as a prize when operating an amusement game certified pursuant to 13:3-7.9 (a)2 [4.2].

Additional Requirements for Specific Types of Contests

If you are offering a golf hole-in-one contest, there are additional requirements. No prize in excess of $1,000,000 shall be offered or awarded to a winner of a Golf Hole-in-One Contest. If any single prize or prizes having an aggregate retail value in excess of $25,000 are offered or awarded to a winner of a Golf Hole-in-One Contest, the entire amount shall be insured by a company licensed by the New Jersey Department of Banking and Insurance to conduct business in New Jersey [3.4].

Conclusion

In summary, you can offer contests that involve non-cash prizes in New Jersey, provided that the winner or winners are selected solely on the quality of an entry in the contest as determined by a panel of judges using uniform criteria to assess the quality of entries. The types of non-cash prizes permitted are limited, and the retail value of such prizes shall not exceed an average retail value of $10,000. Finally, no licensee shall redeem non-cash prizes for money or for the playing of any additional game [1.1][2.1][4.1][4.2][3.4].

Source(s):
Jurisdiction

New Jersey