Is it permissible to cancel a competition before its end due to not meeting the required number of participants, and is canceling the competition considered a retraction of a gift, and is there any sin in that?

The majority of scholars hold that competitions with a prize ( عوض ) are impermissible, except for archery ( النصل ), camel racing ( الخف ), and horse racing ( الحافر ). The Hanafis dissented, adding religious sciences to this category. There is another opinion that prohibits competitions with a prize in permissible competitions — meaning those covered by the textual evidence — if the one offering the prize is not one of the competitors. However, if it involves a prize, it is prohibited or disliked.

If the competition is permissible, the Hanafis and Hanbalis state that the one who offers the prize is not allowed to retract it after the contestant has begun. This is also the counter-most-apparent opinion among the Shafi'is. As for the Malikis and the most-apparent opinion among the Shafi'is, they held that the competition contract is binding on whoever committed to the prize, and permissible for whoever did not commit to anything.

In summary, if the competition is permissible, it is not allowed to withdraw from it after it has commenced. The condition of reaching a specific number of participants within a certain period does not permit withdrawal before the end of that period. However, if the period ends and the required number is not met, then offering the prize is not binding, for conditions that do not contradict the Sharia are valid in all contracts. But if the competition is one in which offering a prize is not permissible, then the competition contract is invalid.