SnoozySloth According to this link on webnovel "https://acts.webnovel.com/2018/62185143/index.html", which is an official statement on their website, there's two types of contracts:
Royalty Contracts, where you keep the copyright and anything else and share the revenue with webnovel. In exchange, they help you make money with it. In other terms, you're the copyright holder and creator, while Webnovel becomes your publisher.
Fixed-Rate Contracts, where you can sell the copyright to webnovel for a fixed price, which will be paid, and this is only my assumption, in monthly wages as long as you continously undate your novel. However, and I quote, "Successful and experienced authors are given priority!".
For me, that sounds like the first option, the Royalties Contract, is the 'normal' one that everyone will be given, while the Fixed-Rate Contract seems like an option for follow-up projects of contracted authors.
I am not a contracted author in any way, so I can also just speculate, though.
As for the writing constest; As long as you're not signing a contract, the copyright will belong to you no matter what. Anything else would be blatent theft of intelectual property.