
While Life Day is freely playable by all Imperial players in SWTOR, the Sith Empire within the game enacts an Imperial Edict known as GR-1NC4 “Grinch” in 15 ATC (the first year Life Day came to SWTOR).
This Edict orders ALL Imperials to not participate in any Life Day festivities offered by the Revelers, as well as bans on ‘contraband’ such as collecting Life-Day Holo Trees, or owning vehicles such as the Sleigh 1 or Cyan Holosphere.
Imperial Police have also been spotted arresting carolers and wookiee celebrants of the activity, even going as far as to label the “Master Of Ceremonies” as the ringleader in this operation.
Imperial Bans have also taken place on:
Dancing in inclement weather
Singing unpatriotic carols
Nonvoilent physical contact with Wookies
The Sith Empire considers the allowance of this event in Imperial locations such as Vaiken Spacedock to be a misfiled license under review in 53-T of Imperial Law. While the mass arresting of carolers and festivity goers is to continue, the sale of their Life Day goods is still allowed to proceed but will be considered Contraband.
While the ‘law’ is still in place within the game nothing stops you from physically participating as an Imperial in any of the Lifeday achievements, quest rewards or obtaining any of the Life Day gifts.
Life Day itself first appeared in the 1970s made for TV Star Wars Holiday Special, where the Galactic Empire tried enacting similar laws over the Wookiee homeworld of Kashyyk.
Sources:
Imperial Edict GR-1NC4 – swtor.com lore blogpost about Life Day.

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