The Ruling on Competition Prizes

Question:
May Allah reward you with good. Shaykh, is it permissible for someone who organizes a competition to include an item of his own in it and stipulate that whoever wants to win it must buy that item from him?

Answer:
Taking money for competitions is not permissible because it is a form of gambling and betting, except for what the Messenger of Allah (peace and blessings be upon him) excluded in his statement: "There is no racing except in three: the arrow, the hoof, or the horse." The arrow refers to archery; it is permissible to take a prize for archery or for a race of camels (the hoof refers to the camel) or for horses (the hoof refers to the horse), because these things are among the tools of jihad and training for jihad. Therefore, it is permissible to take a prize for the winner in these.
Ibn al-Qayyim and other scholars have added to these three categories anything that falls within their meaning, such as memorizing the Qur'an. It is permissible to take a prize for memorizing the Qur'an, or for memorizing a surah from it, or for questions of fiqh and knowledge. He says: "Because this is jihad in the path of Allah; seeking knowledge is jihad in the path of Allah." And other than that, prizes are not taken. Yes.