While many online articles and posts about Sweepstakes and Contests offer great insights and suggestions on ways to increase sweeps engagement or allow you to increase sales by running promotions, there is usually one glaring best practice missing from the majority of these articles; the need for and importance of Official Rules.
If the sweeps is on Facebook or other social channel, some articles smartly reference Facebook’s Promotion Guidelines or the best practices for the channel, and communicated the importance of familiarizing yourself with them before creating a contest or sweepstakes. Yet they do not adequately reinforce the need to understand the various state laws on games of chance and skill contests. While having your promotion removed by Facebook administrators would be a big loss (for violating the promotion guidelines), it fails in comparison to the ramifications of running an illegal promotion.
For instance, many people do not recognize that you cannot require a purchase as a means to enter a Sweepstakes. Furthermore, when running a Sweepstakes in the States of Florida and New York and your total prize value exceeds $5,000 you must register it; bond it (to ensure all prizes can be awarded should the Sponsor not fulfill its obligations); and submit a final winners list so they can confirm your commitment to fulfilling those prizes.
The best way to make sure you are covered from a legal perspective is to have a well-written set of Official Rules that will govern your promotion. The Official Rules are a type of contract between the Sponsor of the promotion and the consumer; and both parties are legally bound to abide by them. Most importantly for the Sponsor, the rules must include liability language to protect them from future claims.
If you need help with coming up with legal, Official Rules for your next sweepstakes, contact us and we can help.
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If a company is thinking about an online sweepstakes/giveaway. Where are Rules posted to be legally correct? I know the Official Rules could be provided after-the-fact if someone won and then is willing to sign Release Docs and receive the official rules then, but is that a viable way of administering an online contest? Or should rules be posted within the link? On the company’s website perhaps?
In the U.S., official rules should be posted prominently and be easy to find during the promotion, either online if it is an online promotion, or in-store or at the location of the promotion if it is offered in a physical location.