In some competitions it may stipulate that if you win, or are a potential winner, that your work will be used commercially to promote this or that, and that you will be paid $x for that use. In other words the terms offered to you in such cases are non-negotiable.
If, in the event that you are a winner, you fail to sign any agreements placed before you to make these terms and conditions legally binding, you will forfeit your winning place and it will be offered to another contestant. This practice is viewed as coercion. It is viewed as exploiting your excitement at being named a winner and thus may be willing to sign unfair terms and conditions in order to retain the prestige of being a prizewinner.
You should be given the right to freely negotiate any commercial agreement, including declining it, and still be a prize winner.
In some rare competitions the cash prize offered for the commercial rights required by the organiser can be very high, high enough for them to be seem fair and reasonable. In these exceptional cases it becomes a matter of judgement as to whether you view the cash prize as fair compensation for the rights you are required to grant.
If you would like to know more about copyright and related rights please read our Guide to Rights and Licensing.