If you pay to enter a competition but the prize has already been purchased by the company, is this haraam?

Question

So basically, I have seen a competition whereby you have to pay for a ticket in order to win a car out of a selection of cars available which are already owned by the company who are giving them away. Is this halal or haraam?

I think it’s a given that I personally wouldn’t know what they do with the entry fee, and if that’s the case does that mean all raffles are haraam. Because I’ve done raffles before whereby I’ll buy the prizes with my own money but not take that out the raffle fund, so everything raised goes to charity.

Answer 1

If the money collected is used to buy the prizes for the competition, then it is consider as gambling, and it is Haraam as Islam strictly prohibits gambling.

However, if there is someone who sponsors the prizes by their own money (for example, the company budget, or personally from a halaal source) then it is allowed.

To answer your question on the cars given out by the company : if the source of the money that they bought those cars in the first place came from a halaal source (which I think is from the company business), then it should not be a problem to give out as prizes, as long as those money collected is not being used back as the prizes.