Running an Instagram giveaway is a fantastic way to connect with your audience and elevate your brand’s or profile’s visibility. To ensure a smooth and legally sound promotion, especially in Bulgaria, where local regulations come into play, consider the following:
1. Official Rules and Terms
Clearly communicate the rules and terms of your giveaway, covering eligibility, entry methods, and details about the prize. Transparency is key, and it’s advisable to provide these rules in Bulgarian and, if applicable, in English. While there’s no strict legal requirement, it aligns with the Consumer Protection Act’s call for clear and understandable communication from businesses. Remember, under Bulgarian law, products and services should have Bulgarian labels, instructions, etc., and marketing communication must be clear and not misleading.
2. No Purchase Required
According to Bulgarian law, participation in giveaways must be free, eliminating any mandatory purchase. If a purchase is required, it falls under the Protection of Competition Act, imposing restrictions on the value of rewards related to product purchases. Be cautious of the potential implications under the Protection of Competition Act, where the prize’s value should not significantly exceed the product or service’s price. In all cases, the prize’s value should not surpass the sum equivalent to 15 minimum monthly wages (currently BGN 6,900, approximately EUR 3,527).
3. Age Restrictions
Specify age restrictions for participants, adhering to legal age limits in Bulgaria. If minors are included, ensure that prizes are age-appropriate, avoiding items like alcohol or tobacco, and comply with laws regulating restricted items.
4. Prize Conditions
Clearly describe the prize, its value, and any associated conditions. This not only ensures transparency but also helps comply with local acts like the Consumer Protection Act and Protection of Competition Act. Pay attention to the requirements under the Consumer Protection Act regarding clear communication and transparency to participants.
5. Data Protection and Privacy
Respect data protection laws. Inform participants about how their data will be used, obtain necessary consents, and follow GDPR and Bulgarian data protection regulations. Clearly communicate the purpose of collecting personal data, provide the official registration of the entity collecting personal data and contact details of the data protection officer (if applicable), and inform the participants about their rights to access, delete, correct, etc., their personal data.
6. Compliance with Instagram Guidelines
Adhere to Instagram’s promotion guidelines to avoid penalties, as violations can lead to content removal or other adverse actions. Stay informed about Instagram’s rules and regulations for promotions. Ensure that your giveaway aligns with Instagram’s policies to maintain a positive online presence.
7. Tax Considerations
Be aware of potential tax implications related to the prize. Non-monetary prizes may be subject to a flat income tax rate of 10%. However, prizes of negligible value (not exceeding BGN 100 or approximately EUR 50) are exempt. Organizers must calculate and withhold applicable taxes when providing such prizes. They should issue a document certifying the value of the prize and the amount of tax withheld. Additionally, organizers are required to declare and remit all withheld taxes by the end of the month following the quarter in which the prize was awarded. In instances where a brand sponsors and an influencer oversees a giveaway, the agreement between them should specify the party responsible for calculating and withholding taxes. Typically, this responsibility falls on the brand’s shoulders in the majority of cases.
8. Notification of Winners
Clearly outline how winners will be notified and when they can expect to receive their prizes. Have a reliable method to contact winners promptly.
