Gambling in a furniture store?

May a furniture store promise its customers a refund of a paid purchase price if it rains on a specific day? This question had to be decided by the Federal Administrative Court (BVerwG) on referral from the Government President of Karlsruhe (Regierungspräsidium Karlsruhe), which took the view that the planned promotional campaign constituted a licensed gambling activity.

A furniture retailer planned a promotional campaign whereby its customers could demand a refund of the purchase price of goods purchased there upon winning a wager on the weather. The furniture store advertised as follows:

"You will get your purchase price back if it rains on …".

In the campaign intended by the furniture store, every customer who purchased goods for at least EUR 100.00 within a fixed period was to receive his money back if it rained on a predetermined reference date between 12.00 and 13.00 hours at Stuttgart Airport.

The Government President of Karlsruhe (Regierungspräsidium Karlsruhe) deemed this promotional campaign to be unlawful gambling, since the customer only received a chance to win if he had previously purchased goods from the furniture store. It therefore prohibited the furniture retailer from advertising with such a wager on the weather.

The furniture store resisted this administrative act and was successful in both lower instances. The Government President then submitted this legal question to the BVerwG.

Court decision

The Federal Administrative Court (BVerwG) decided in Judgment of 09.07.2014 – Az. 8 C 7.13 that the promotional campaign planned by the furniture retailer was not gambling within the meaning of the Interstate Gambling Treaty (GlüStV) and therefore the promotional campaign did not require gambling law approval.

The BVerwG reasoned that the customers of the furniture store did not pay the purchase price for the acquisition of a chance to win, but as the purchase price for the furniture purchased. The customers wanted to acquire the purchased goods at a market-appropriate price and had the opportunity to carry out price comparisons with competitors.

The customers did not bear a loss risk characteristic of gambling, since they were entitled to keep the purchased goods regardless of the campaign – even if it did not rain at the designated time. Furthermore, the selling prices were not increased during the campaign period, so that customers were not charged any "hidden" consideration for the acquisition of a chance to win.

Conclusion

The conduct of gambling is generally subject to licensing requirements. If such gambling is conducted without official approval, competitors may, in addition to the responsible authority, resist it with cease-and-desist notices for unfair competition. Whether a promotional campaign constitutes such gambling should therefore be thoroughly examined beforehand.promotional campaign in addition to the responsible authority, also competitors may resist with cease-and-desist notices for unfair competition.