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Unless a violation of law, a sponsor or administrator can limit their promotion to whomever they wish. While few may actually address religious beliefs or gender in their Official Rules, depending on the situation it may not pose any legal issue. This is a complex question that would need to be evaluated on a case-by-case basis.
Unfortunately, there is no universally-applicable answer. Your blog is really good to read and helpful for us. I hope you will post good articles like this in future. There are three different types: sweepstakes, contests, and giveaways. Thank you very much for your article, I really enjoyed your well-written summary of this important issue. Also, I read all the comments, but I have a question I could not get an answer for it. So, If I would like to do a sweepstakes, I need to have a free entry, but I also can have other optional entries as well.
Can the host allow the participant to register 3 times for a sweepstakes in order to get a better chance at winning? US Sweepstakes laws permit optional entries, which may or may not confer consideration to the administrator, sponsor, or a designated recipient.
What the law does not allow is for some entries to give a greater chance of winning than other options. The trouble arises when optional entries create a greater chance of winning. This type of entry process would violate nearly every state law regarding sweepstakes because some entry methods gave the entrant a great chance of winning than others. Would this be compliant as a free entry? Follow up question: Does the new FTC disclosure guidelines apply to sharing giveaway images as a form of entry?
The FTC disclosure guidelines would not necessarily apply with a simple share. However, if there is a link or action whereby the original sharer would obtain additional entries if someone takes those additional actions it may require appropriate disclosure.
Instagram sweepstakes do pose a number of unique challenges with regard to the legal requirements at both the state and federal levels. I just entered a sweepstakes that has some strange rules. It says that if you follow someone on a website Twitch. What are the laws regarding something like this? Is this allowed? Sweepstakes must not have any means of entry that provides a greater or less than equal probability of winning when compared to other means of entry. Whether mandatory or an alternative means of entry, the entry must not only give consumers an equal chance to win, but the format must also not be overly difficult.
If some entry methods give an entrant more entries than others that would be a violation of state law. Hawkins has a post all about blog giveaway you should really […]. Thank you for this article.
They ask you to like and share to be eligible but there are no rules and they never list winners. Any promotions, especially a sweepstakes or contest, that does not have detailed rules should be evaluated very closely.
Any real company giving away a prize valued of any significant amount would likely have given consideration to the legal ramifications of what they are doing. In addition, there are platform rules. Violation of platform rules may not bring about the same issues as legal violations, but few legitimate companies are willing to risk having their page taken down for blatant violations of a platforms terms. Thank you for the great information here. My question is around a private sweepstakes to members of our program.
It would not be a public offering to everyone, but only published to members through an email campaign. The Prize would be a promotional item from the site. A sweepstakes is a game of chance and whether made available to the general public or to a private membership organization the same laws apply. The only difference is that if the organization is a specific organization usually certain charitable organization or educational institutions covered by laws relating to raffles raffles are the same as a lottery but permissible by law for certain exempted groups.
Hi Sara, What a great article. I have a question. I participate in a social media contest that promise a prize to the five people with the most likes on a picture. However, that rule was not part of the rules sent to all the participants in an email.
The company is in the state of California. My question is if there is any type of law or place where I can put complaint for what it seems to be a misleading marketing or false advertisement. When it comes to bloggers, there are few things more valuable than followers. While I suggest doing your own research, this post might be a good place to […]. I recently entered a contest where they had a deadline for entry listed in the official rules ex.
Perhaps there is another method of entry and this person won based on that or the time shown on Facebook was your local time and the rules used a different time zone. This blog was really interesting as I was finding the same top about the law blog giveaway is legal or not, thanks for helping me out.
If so, what can I do about this? If there are official rules those would be the first resource to review regarding what can and can not be done. This type of inquiry is very fact specific. I hope this would come across all the bloggers so they can be aware of the said law for giveaways. We are going to run a Twitter Poll for Physical Therapy students to enter.
At the end of the month all Tweets will be entered into a drawing. The winning student will receive a brand name product worth X amount of dollars.
In our Poll tweet, are we allowed to mention the brand name of the product they will be winning. Are you allowed to mention the brand?
Of course, that depends. This is an excellent example of the various legal questions that come up when using third-party trademarks in a sweepstakes or contest. In a tweet there may not be enough space to explain the relationship. If there are no official rules, even using Twitter could present liability with regard to their TOS.
This is why official rules are really important, so these matters can be dealt with appropriately. I hope you can help me. There is an East Coast magazine that has an ongoing sweepstakes. Every day, they award a new prize. The prizes are mostly anti-aging skincare kits, and many are luxurious and expensive. In fact, she sometimes won twice within one month! How can that ever be possible in a random draw? I contacted the magazine. They said they were checking to see why her name kept getting chosen.
Then a little bit later, I saw another woman in California also won twice within a short period of time. I contacted the magazine again. They wrote me back and said that because of what happened, they changed the rules and now a person can only win 1 time per year. I believe they can easily award prizes to people who have subscriptions to their magazines, buy their products, etc, without anyone keeping them on the straight and narrow.
A sweepstakes is a random draw, which means there is an equal likelihood that any one entrant is chosen. If the winner is not chosen by random draw that would be a clear violation of sweepstakes laws.
In the mids, one of my entry blanks was drawn both in week one and in week five for a grocery store sweepstakes. In , one week after I won a TV bingo jackpot, my wife won a smaller jackpot. After that, the TV station changed the rules so that a person could only win once every 90 days. But it is certainly possible that someone there might be playing games, but hopefully with the change in rules, the prices will get spread out. You certainly did the right thing by bringing it to the managers attention.
I think there are ways that sweepstakes can be tampered with. Mail, BUT now we have the Internet. I really believe that companies can decide to increase the odds for people who purchase their products.
If they are the ones choosing the winners, why not? There is another major magazine that I used to have a subscription to for years. I last won from them 4 years ago. Another thing: When I lived in some other states, I won more often and I entered a lot less. It was a noticeable difference. So, I believe the entries are probably at least being separated by state. The magazine I wrote about seems to continually award prizes to people living in certain states.
People in those states win again and again, and the states are not very large or heavily populated. I agree with you. I wish that the places that offer to send out lists of winners would also identify what percentage of the entrants made a purchase and what percentage of the winners were people who made a purchase.
Having that information as a summary after their previous sweepstakes were over would allow a person to decide whether a contest was honest or not. A year or two ago, I got one of those postcards in the mail that told me I might have won a car. I would like to know: if a rule or stipulation of entry into a contest is a donation towards a community project, would that make the contest into a lottery? Donations are consideration and, generally, would create a lottery situation.
Hi Sara, Thanks for the info! My company wants to give away a Disney vacation to one potential new patient out of the hundreds we see during the course of a year.
Do we have to have official rules for this? I always suggest having official rules for any contest or sweepstakes so you can ensure that there are known rules as to how the promotion will be operated and the entrants know what responsibilities they have.
In addition, using a third party trademark such as Disney could create trademark liability issues that could easily be covered in a set of official rules. Sara, Thank you for the information in this post. I want to run a giveaway, where the winner is given a To enter they have to subscribe to our newsletter.
The winner would be chosen by me randomly at the end of the contest. As long as I inform the public what the rules are, is there anything else I need to do? Also, can people from other countries win as long as again, it is stipulated that the money is US dollars payable only through Paypal?
Ken, for residents of a jurisdiction to be permitted entry into a sweepstakes the sweepstakes must comply with the rules and laws of that jurisdiction and may not be prohibited by another jurisdiction.
For example, in the US, there are a number of countries for which there are federal embargo laws so US businesses may not do business with those countries except under certain circumstances. In addition, many countries outside the US do not permit a sweepstakes promotion with the same criteria as the US. Also, there may be a question regarding whether subscription to a newsletter is sufficient to be deemed consideration since there are no specific legal or regulatory guidelines other than the prior cases, few of which speak to modern technology.
As with any subscription process, and especially with a subscription being an entry method for a sweepstakes, laws regarding direct marketing must also be considered. I run a small boutique and recently there has been A LOT of rumors swirling about this subject. I realize, from reading your article, I run sweepstakes I thought they were just a fun little giveaway to the people who routinely shop with me!
Julie, there are no state or federal laws the specify what the minimum value of a prize must be for a business offering a consumer sweepstakes. There are, however, a multitude of consumer protection laws that may apply if the prize is meaningless and solely used as a means of obtaining information so the business can market to the entrants.
There are consumer protection laws that generally state the requirement to pay to redeem a prize could be a sign that the promotion is a scam. While a business may have good intention, a promotion where the winner must spend more money to actually redeem the prize may fail to meet the minimum guidelines set by consumer protection regulations. This post by Sara Hawkins offers some insights.
But speaking to a legal professional about your specific […]. I have created a review blog, and to date, all of my features have been unpaid though I have received samples in exchange for my review. I am in touch with a company that is possibly interested in paying me some modest amount for a sponsored post. What kind of disclosure etc. Check out my posts about FTC-required disclosure, they will give you information on what is needed to comply with regarding to paid, sponsored, or business-related content.
Even if you are just getting product for free to review, that is information that requires disclosure under FTC regulations. We are looking to begin a campaign of mystery card values. We will distribute gift cards with mystery amounts. When the cards are brought to us, or we care called, the card holder may redeem the card value.
May we make a criteria around the card program s? For instance, they must open an account? Or do must we allow for a general mail in for the giveaway? Adam, there are too many variables with a promotion such as you have briefly described to answer your questions. Many sweepstakes providing on-line gift cards as a prize will require that the user create an account to redeem the prize. Sound like you are needing legal advice as what you are asking is beyond the scope of general legal information regarding sweepstakes administration.
If I can help, please contact me privately. Thank you for the information you have provided. My agency is working with a non-profit. They want to run a contest to increase their social footprint and get their membership to download their new mobile app. Their members range in age from years old. In that case, is there any issue running the contest to someone 18 years or younger?
A couple more pieces of info:. Many sweepstakes and contests are limited to specific groups, it just has to be stated in the rules and be legally possible.
Question, I know for shipping a giveaway, the shipping must be free to the customer. These are two different aspects of prize redemption. If the goal is to reward a customer or to make a new customer why have a prize that will undermine that goal? I will ask people to visit the FB, Instagram, twitter, and Pinterest of the company that provided the free codes and my own social media.
Is it ok to make this giveaway international? Sweepstakes that have no limitation as to country are rarely compliant with all jurisdictions. Platforms often allow users from many countries to use their platform, with Terms specifically stating that the user is responsible for all legal and regulatory compliance related to their promotion. Many non-US jurisdictions have laws requiring registration or use of certified legal translations.
In addition, there are US laws that prohibit trade with residents in embargoed countries. While logistically possible to hold a global sweepstakes or contest, legally it is quite complex.
This article is amazing, I want to appreciate you for sharing as being a law student I really like reading articles related to law and lawyers because it increases my knowledge and helps me out. Depending on how the Facebook promotion is structured it may or may not be a prohibited game of chance under New Hampshire law.
If the requirement to enter the promotion is 1 to make a purchase; 2 the winner would be chosen by random selection; and 3 a prize will be awarded, that is a lottery and is illegal in all 50 U.
There is a detailed comment thread here that might be useful if you have specific […]. Does this have to be reported to IRS? Its not really monetary gain. We just decided to give it a value based on site traffic and etc. It is not solely monetary winnings but all winnings since the IRS collects tax on all prizes and winnings regardless of value. The value reported is the fair market value at the time the prize was transferred to the winner.
Thanks alot Sara! That cleared up alot for me.. I actually researched this answer a little further and read a blog post about taxes being paid on those Million Dollar HGTV Dream homes.. Really Eye opening… They mentioned in the article about its not about actually receiving the money for the house… but the value of the prize….
However, I still have a small question after reading your blog. If i draw several out of the people who gives me their email address for a gift, and then the more they share on social media, the more entry they have for the draw, is it a contest or sweepstakes? A sweepstakes is a game of chance where the winner is selected through a random draw. If you are just drawing names regardless of any specific selection criteria that would be a sweepstakes.
Thank you so much for this great article. Is that correct? But do I still need to follow specific Canadian rules? With regard to some of your questions, you are asking for legal advice and that is beyond the scope of the website-enabled comments. Contests must be compliant with all laws and regulations for the jurisdictions in which they operate.
A contest is a game of skill. Do you know of one centralized place where all the State laws regarding sweepstakes can be found? Bruce, there are likely to be legal treatises or books on the topic but they would not be available for purchase by the general public. I want to offer two chances to win for each time my services are used One entry for the person using my services, and one for the person who referred the customer.
I understand about clearly written and easily obtained rules. I even understand about the clear records keeping who wins, how they are chosen… mine will be a random drawing, etc.
There are two businesses who do something similar that I can think of right away. How are they able to legally do a sweepstakes and how can I copy those same steps to keep my company and myself on the right side of the law? All, however, must comply with the same consumer protection laws. Often sweepstakes that promote an entry in exchange for a purchase will have a free means of entry as well that will have that one aspect of the process comply with state laws.
Hello, I am currently 16 and would like to enter in a giveaway by some other person. I live in the US. Thanks, Kevin. You should not have to worry about looking up your state laws. The rules for the contest you are entering should make it very clear if there is a minimum age or other restriction for entrants.
If the rules do not specify a minimum age, you can generally assume that you are allowed to enter. In general, the worst that might happen is that the company might award the prize to a person of your choice that is of age. That is likely not the worst that might happen. The worst that might happen is that an entrant is declared ineligible and disqualified from receiving the prize. Allowing an ineligible entrant to somehow make themselves eligible is a questionable practice.
Kevin, you should read the official rules to find out what age limit is set.
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