MTN competition 'unlawful'

Johannesburg, 14 Jul 2009

The National Lotteries Board has found that the recent controversial MTN SMS competition is in contravention of the Lotteries Act.

MTN terminated the competition ahead of schedule earlier this month, because the controversy surrounding it was not “in line with its values”, it said. Africa's largest cellular company processed the last entries a month early, as the competition was initially intended to run until 9 August.

MTN launched the competition at the end of April to celebrate its 15th birthday and it has since been dogged by controversy.

In June, allegations were made indicating some of the competition winners had access to a list of entrants and each person's score. Several contestants have also indicated winners were possibly friends or family of someone at MTN.

Many customers were concerned the cost was high, with SMSes charged at R7.50 each. Over R6 million worth of prizes were won during the course of the competition.

Lotto allegations

As a quiz-style SMS service, the competition was initially slammed as a lotto, which prompted MTN to invite the National Lotteries Board to investigate.

National Lotteries Board spokesman Sershan Naidoo says the board investigated the competition and met with MTN to inform the cellular operator it was acting in contravention of the Act. MTN agreed to end the contest.

Naidoo says the lotteries board “contends that the [MTN] competition is unlawful”. He did not give any specific reasons for the decision.

Although MTN has halted the competition, the board has reserved its rights to take further action, although Naidoo did not say what the board might decide to do, or if any sanctions might be imposed.

Naidoo says, as competitions come up, the board investigates. Should it decide the competitions are unlawful, it will send a letter to the company running the competition telling it to stop. If the letter fails to put an end to the competition, the board will approach the courts to intervene.

The lotteries board cannot force a company to close a competition, or impose a fine, says Naidoo. These actions are up to the courts should the judge find the competition is unlawful.

In February last year, the lotteries board said the Vodacom win-a-BMW competition must be stopped. The board deemed the competition illegal.

Last month, the Wireless Application Service Providers' Associationsaid it had also received complaints about the MTN competition. However, the association noted it does not have any jurisdiction to intervene in the matter.